Investors in Asia have flocked to COVID-19 defensive or growth sectors like technology this year, while COVID-19 cyclical or value sectors have lagged significantly. Citi analysts expect this relative performance to reverse, at least partially, as re-opening takes place.
Amid tensions between US and China, Hong Kong’s (HK) prospects have come under pressure. Citi analysts share their views on key financial and economic questions from investors.
Although COVID-19 may have had an impact, overall IT spending plans are expected to grow, with software getting more funds, while hardware and services less.
An Aging China: Turning Adversity into Opportunity
By Jessica Tan
China’s old age population share is likely to double from 12.6% to 26% in 2050 with total population likely peaking in the late 2020s then declining. From an equity strategy perspective, the aging population is like to lead to more divergent performance among sectors. In particular, healthcare, internet, consumer discretionary and insurance may benefit.
In the months ahead, occasional bouts of uncertainty and market volatility can be expected, with a potential re-emergence of COVID-19 cases, US-China relations and US elections among the top risks.
