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Speaker 1: Let's get to Evil Lee. She's our guest. She will

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Speaker 1: be with us for the half hour. Eva is the

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Speaker 1: chief investment officer at UBS Global Wealth Management. She joins

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Speaker 1: from our studios in Hong Kong. Eva, thanks for being

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Speaker 1: with us. So many unknowns. I think we can agree

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Speaker 1: on that. In the market right now, we've got an

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Speaker 1: aggressive FED. How much more aggression we're going to see?

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Speaker 1: That's unclear. Europe seems to be in the grip of

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Speaker 1: a recession already given an energy crisis there. Where are

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Speaker 1: you right now on the standing of the global economy

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Speaker 1: and are you defensive at all? Are you maybe leaning

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Speaker 1: into some opportunities that you're seeing in various parts of

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Speaker 1: the globe, particularly the Asia region. Well, I think we definitely,

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Speaker 1: you know, need to understand are basically a few scenarios

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Speaker 1: are developing and at the moment um we are not

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Speaker 1: sure as what you said, it's um it's uncertain, like

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Speaker 1: for example, where there the fat rate heights would really

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Speaker 1: be able to cut inflations as what they intended, how

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Speaker 1: much they need in to do so? If they failed

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Speaker 1: to come invasions, what will happen? And at this stage

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Speaker 1: we continue to recommend investors to go with the um

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Speaker 1: the value segment of the growth segments will continue to

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Speaker 1: be impacted by the rising ten year yield or rising rates.

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Speaker 1: And then on the other hand, we actually um advise

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Speaker 1: investors to go with pirate markets, to go with how

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Speaker 1: do you take advantage of the volatility in the market.

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Speaker 1: I think this is sort of a more proactive approach,

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Speaker 1: I have to say, UM, in this sort of market

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Speaker 1: we saw yesterday in China, the banks decided not to

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Speaker 1: move on the LPR, and that came after we didn't

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Speaker 1: see the p BOC ease as well. Do you think

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Speaker 1: that is a positive sign that stimulus isn't needed at

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Speaker 1: the moment we're seeing more recovery coming through in China. UM.

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Speaker 1: I don't. I don't. I don't think we should read

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Speaker 1: it at site. They do not or they not see

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Speaker 1: stimulus is needed. It's just that they don't want to

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Speaker 1: use rate cuts as a tool to stimulate economy. I

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Speaker 1: think they will continue to um UM with physical measure

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Speaker 1: like you know, bringing forward more of the l G

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Speaker 1: bonds issued in this year even for next year quarter

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Speaker 1: um you know, bring into second half UH and also

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Speaker 1: trible cuts increasing the liquidity. I think these are some

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Speaker 1: of the measures they will pursue rather than rate cards.

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Speaker 1: I think we have to understand at the moment US

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Speaker 1: is raising rates. If trying to continue to really cut

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Speaker 1: policy rates, the spread is going to widen and that

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Speaker 1: will have an impact onto the currency as well. So

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Speaker 1: there are a lot of concerns when they think about

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Speaker 1: what to do in terms of stimulating the economy. So

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Speaker 1: if you were to give them a recommendation policymakers in

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Speaker 1: Beijing right now, what would it be. I think the

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Speaker 1: most immediate thing they need to do, it's look after

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Speaker 1: or try to stabilize the China property market because at

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Speaker 1: the moment, we all understand that you know, these suspensions

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Speaker 1: or boycotts or mortgage payment you know, spreading pretty fast,

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Speaker 1: and they need to do some sort of active movement

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Speaker 1: like for example, breaching loans providing to developers to ensure

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Speaker 1: the completion of this project. So I think doing everything

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Speaker 1: to ensure that to restore people confidence onto the housing

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Speaker 1: market because at the end of the day, this is

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Speaker 1: something that could have a big wealth effect as well

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Speaker 1: as a big impact onto the harmonious society. You've also

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Speaker 1: had a dB today cunning agentes GDP forecast with China

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Speaker 1: sticking to COVID zero. So a lot of concerns, but

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Speaker 1: you're still expecting the Chinese market to deliver high single

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Speaker 1: digit returns. So where are you saying the key opportunities here? Well,

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Speaker 1: I think first the market actually has corrected quite a lot.

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Speaker 1: I mean, given the incidents that mortgage boycott, UM, you know,

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Speaker 1: events affecting not just property but also you know, the

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Speaker 1: banking sector as well as the consumption sector. I think

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Speaker 1: given you know, all these developments, and then on on.

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Speaker 1: On the other hand, I do expect you know, the

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Speaker 1: regional and the national governments now you know, sort of

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Speaker 1: seeing this issue, as I said, really affecting not just

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Speaker 1: the economic side, but also the broader you know, local people,

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Speaker 1: social you know, stability, so they will step in. If

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Speaker 1: with them stepping in, then actually it will hope we

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Speaker 1: have a higher hope that to resolve this issue. So

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Speaker 1: building all this together and plus all the fiscal measures

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Speaker 1: coming through, we expect at least in terms of sentiments

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Speaker 1: returning to the market that will bring you know, people

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Speaker 1: attention back to you know, the recovery, the earnings recovery

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Speaker 1: in second half, and hopefully bringing the UM you know,

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Speaker 1: these earnings multiples to a more reasonable level. I think

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Speaker 1: this is where the return is coming from. So when

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Speaker 1: you look at areas like consumer discretionary and I'm thinking

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Speaker 1: of the casinos in Macau they've been shut now for

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Speaker 1: only two weeks and we're going to get a reopening

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Speaker 1: on Saturday. If here's the caveat the condition with the

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Speaker 1: virus will allow for that. Are you going to be

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Speaker 1: looking at certain pockets of the consumer discretionary space to

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Speaker 1: kind of look at the health or understand the health

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Speaker 1: of the Chinese consumer. Well, I think UM reopening will

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Speaker 1: continue to be a theme that we will focus on UM.

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Speaker 1: And on top of that, you know the e V

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Speaker 1: supply chain, the orders actually they still register pretty solid UM.

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Speaker 1: You know sales June definitely is a very strong numbers.

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Speaker 1: Even July it's not too bad. Renewable energy will be

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Speaker 1: continued to be the government policy focus. Company equality is

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Speaker 1: something they want two works as well as industrial automation.

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Speaker 1: So we started looking at it. It's like reopening plus

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Speaker 1: you know some policy folk, these are the areas that

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Speaker 1: UM we we we like to focus on. So reopening,

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Speaker 1: what about in the tech space, because we've seen this

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Speaker 1: news that Beijing could be handing down to find more

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Speaker 1: than a billion dollars to d D. That could be

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Speaker 1: a hefty fine, but it could also wrap up this

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Speaker 1: real long probe into the right hailing giant. What are

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Speaker 1: you looking at in terms of evaluation for Chinese tech

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Speaker 1: stalks and the difference between the A d R S Well,

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Speaker 1: I think, first, um, the d D case I look

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Speaker 1: at it, it's just like a penalty that already have

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Speaker 1: impulsed to Baba in turn cents a year ago. I

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Speaker 1: think it's just after the very long investigations they finally

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Speaker 1: come up with the number and that is exactly what

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Speaker 1: you said to wrap up the case. And then I

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Speaker 1: think the attention should be on the second quarter results

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Speaker 1: on digital economy UM, like you know, whether we know

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Speaker 1: that lockdown will have a negative impact onto their earnings,

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Speaker 1: but it might not be as bad as what market expect.

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Speaker 1: This is this seems to be the case. And then

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Speaker 1: on more importantly, what did they guide for a second half,

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Speaker 1: so these will be you know, sort of elements that

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Speaker 1: makes us more constructive on these UM internet stock. So

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Speaker 1: around the region, let's talk about markets outside of China.

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Speaker 1: Is there anything that you're favoring right now Indonesia and Thailand.

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Speaker 1: These are the two markets that we've favor. Thailand again,

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Speaker 1: it's similar to China, is a split a reopening theme,

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Speaker 1: you know, people going back to Chainland, you know, just

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Speaker 1: spent a holiday there. Indonesia it's more of a commodity

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Speaker 1: play alright, Indonesia and anywhere else in the region, or

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Speaker 1: it's just really there. We're looking at course to an

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Speaker 1: interest rate decision there too. Well. I think the strengthening

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Speaker 1: of US dollar would really affect you know, areas like

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Speaker 1: India rup here, so they're definitely on the weak side.

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Speaker 1: And I think the strengthening also, you know, would have

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Speaker 1: would be sort of capping you know, women be you know,

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Speaker 1: performance as well. I think this is so one more

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Speaker 1: or lesser one way development at a moment, given you

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Speaker 1: a stolar social absolutely in the roupeat hitting that record

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Speaker 1: low eighty to the dollar a couple of days ago,

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Speaker 1: even thank you so much, Even Chief investment officer ubs

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Speaker 1: Global Wealth Management