Insights

  • MONTHLY FUND COMMENTARY

July was a strong month for Chinese equities, with the MSCI China Index soaring 8.3%, up the seventh consecutive month in 2017. The last time such a long winning streak occurred was due to the short-lived bull market in 2015. 

  • MONTHLY FUND COMMENTARY

Q1 earnings of Japanese corporations were better than expected, leading investors to increase their confidence in companies that exceeded initial earnings estimates. According to a report by Mizuho Securities, earnings of manufacturing companies were especially strong and rose 31% YoY in the first quarter, whilst that of non-manufacturing companies declined 7% YoY during the same period. 

  • MONTHLY FUND COMMENTARY

The Funds benchmark returned -0.37% in July. NYMEX WTI CRUDE was up 8.97% in July MoM to finish at $50.17 despite ongoing disputes regarding production caps and inventory levels. 

The Strategic China Panda Fund returns strong absolute and relative performance YTD 2017. Portfolio Manager, Lilian Co analyses the key drivers behind China's new economy and how an equity market rally has been driven by proving corporate profitability. 

  • MONTHLY FUND COMMENTARY

In June, the Japanese market rose again supported by investors’ strong expectations of bottom-line growth of Japanese companies. During the month, a solid dollar/yen rate supported the overall market and especially low valuation stocks performed. The dollar/yen rate weakened after the FRB’s announcement of a 25bp rise of its FF rate in the middle of the month. It however quickly came back to the 110 yen level.

  • MONTHLY FUND COMMENTARY

In June, the European stock market experienced a constant and gradual slide. In the first half of May the Europe Index posted a high of 133.8, following the French elections. This movement was followed by two corrections: After having reached the month’s top on 2nd June, the first decrease happened over the first half of June, whilst the second downside swing occurred on June and continued until month end, with a bear climax on the first two days of July.

  • MONTHLY FUND COMMENTARY

The Funds benchmark returned -2.48% in June. NYMEX WTI CRUDE was down 4.72% in June, finishing at $46.04 as ongoing disputes regarding production caps and inventory levels made headlines. The US 10y treasury yield increased 4.6%, finishing the month at 2.30% following further hawkish comments regarding US rates.

  • MONTHLY FUND COMMENTARY

In June, US economic data was disappointing as consumption, production and business confidence decreased. On 14th June, the Fed raised its Fed funds target range from initially 0.75%-1% to 1%-1.25% and unveiled its plan to shrink its balance sheet (by USD 10 billion/month, including 6 billion of Treasuries and 4 billion of Mortgage-Backed Securities). 

  • MONTHLY FUND COMMENTARY

To mark the first half of 2017, this report will include: (1) a brief snapshot of the U.S. economy, (2) an overview of the upcoming earnings season, and (3) a review of the Fund and the changes that have been implemented in June.

  • MONTHLY FUND COMMENTARY

During June, the Fund outperformed its benchmark by +1.89%, however it made a small loss of -0.64% on an absolute basis. The Fund finished the first half of 2017 up 17.63% on an absolute basis, outperforming its benchmark by +10.59%.

  • MONTHLY FUND COMMENTARY

In June, the Japanese stock market kept rising due to the yen weakness against major currencies and healthy economic data from Japan and overseas. The Nikkei 225 closed the month at 20,033.4 (up 1.9% MoM) and the TOPIX at 1,611.9 (up 2.8% MoM), with both indices recording a three month consecutive rise.

  • MONTHLY FUND COMMENTARY

June was yet another up month for the local bourse. The MSCI China index climbed 1.5%, making a half year return of 23.7%. Continuous inflow from southbound funds remained the major buying force pushing the market up. The A-share market finally played catch up with the CSI 300 (up 5%), in anticipation of the inclusion of A-shares into MSCI indices. 

China’s push into international markets took a leap forward in June with the announcement that the MSCI Emerging Market Stock Index will start to add 222 China A Large Cap stocks on a gradual basis commencing in early 2018 a key barometer of emerging market equities. The move will further diversify the range of Chinese equities beyond those listed in Hong Kong. This is widely expected to trigger a flow of global capital into China’s $7 trillion domestic stock market.

  • MONTHLY FUND COMMENTARY

Economic data releases in May haven’t altered the main direction depicted in last month’s report. Nonetheless, some small changes in (1) the employment situation and (2) the Federal Reserve are worth mentioning before focusing on (3) the Fund’s developments during that same period.

  • MONTHLY FUND COMMENTARY

May was a month of two halves for European equities, in the first half of the month we witnessed a follow through rally which took the MSCI Europe Index (MXEU) to the 134 level (up +2.48%), which acted as strong resistance in the short term as the market posted five daily highs near this strategic level. The second half of the month was corrective at first followed by a sideways movement. Overall in May the MSCI Europe Index gained +0.79%, closing at 131.62.

  • MONTHLY FUND COMMENTARY

In May, US activity indicators were disappointing while unemployment figures and average hourly earnings were strong. The Fed kept its monetary policy unchanged and made very few changes in its statement, saying that weakness in growth is expected to be transitory.

  • MONTHLY FUND COMMENTARY

The Fund’s benchmark returned 1.53% in May. NYMEX WTI CRUDE was down 2.05% on the month to finish at $48.32 as discussions regarding oil production caps from OPEC and US Inventory levels caused concerns. The US 10year treasury yield decreased 8bps to finish the month at 2.20% following mixed economic data and the prospect of US rate increases.

In May, the Japanese market rose again, with small caps outperforming large caps. The market was supported by better than expected FY2016 bottom lines from Japanese corporates, and reasonable forecasts for the new fiscal year which began in April.

  • MONTHLY FUND COMMENTARY

European financial markets moved upwards during the month of May, with the Fund’s benchmark up +1.46%. As mentioned last month, the French elections result confirmed the first round outcome and removed a key risk for the markets.

In May, China stocks simply went from strength to strength. The MSCI China index soared another 5.1% in May, making it the fifth consecutive monthly gain this year. Financial deleveraging and rising bond yields only had a short-lived impact on market sentiment.

Pages