China outlook positive despite recent regulatory changes - AIA
Reuters
Published Aug 04, 2021 12:54PM ET
By Divya Chowdhury
(Reuters) - Financial company AIA retains a positive outlook on China, driven by its long-term structural growth and commitment to open up financial markets to foreign investors, despite its recent regulatory changes, group CIO Mark Konyn said.
"International investor sensitivity to policy risk has certainly heightened," Konyn, who's firm manages $230 billion in assets, told the Reuters Global Markets Forum on Wednesday.
But he viewed these regulatory changes as a transitionary phase, with long-term sentiment intact on the liberalisation of China's financial system.
"The bottom line is markets are recalibrating risk premiums on Chinese risk assets ... we continue to hold a positive outlook on China," he added.
Chinese stocks and sentiment took a drubbing with Communist Party rulers seeking to remake the property, technology and education sectors to curb cost pressures and better serve ordinary people.
Konyn said the sell-off in Chinese equities has provided opportunities to invest in the country, such as in financial services and sectors catering to direct consumption, in line with the themes of urbanisation and a broadening middle class.
Meanwhile, Konyn expected inflation to be transitory and the U.S. Federal Reserve to announce its stimulus withdrawal plan by November or December this year, but he did not see markets reacting to that in a 2013-style taper-tantrum.
He predicted the dollar index to end 2021 near the 97-level and the U.S. 10-year Treasury yield around 1.6%.
The dollar index has risen 2.5% year-to-date to 92.251 currently, and the U.S. 10-year Treasury yield has increased to 1.1920% from 0.9182% on Jan. 1.
(This interview was conducted in the Reuters Global Markets Forum chat room on Refinitiv Messenger. Join GMF: https://refini.tv/33uoFoQ)
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.