Speaker 1: Asian equities are on a tear, from South Korea's cosp
Speaker 1: index to Hong Kong's Hang saying the region stocks are rallying.
Speaker 1: That's just by domestic and global political risks. Part of
Speaker 1: this trade lays in the cell us trade that's gripped
Speaker 1: global markets, but there are also factors driving funds to
Speaker 1: the region, including China's increased focus on technology.
Speaker 2: You're listening to Asia Centric from Bloomberg Intelligence. I'm John
Speaker 2: Lee in Hong Kong.
Speaker 1: And I'm Katidmitrieva, also in Hong Kong.
Speaker 2: Today we're offering a catch up on big themes for
Speaker 2: equities this year and what lays ahead for twenty twenty five.
Speaker 2: Why are stocks rising despite growing risks, Where can investors
Speaker 2: still find value and what are the biggest opportunities.
Speaker 1: So we're joined today by Jessica t She's Emerging market
Speaker 1: and APAC equity investment specialist at JP Morgan Asset Management.
Speaker 1: Thank you so much for joining us today.
Speaker 3: Thank you very much for having me.
Speaker 1: I wanted to start kind of broadly because we're challenge
Speaker 1: just before the show about the resilience of the equity
Speaker 1: market even in the US where you had, you know,
Speaker 1: a bit of a hiccup earlier this year, the stocks
Speaker 1: came back, even in countries where there might be political
Speaker 1: issues or exposure to the trade war. Are you surprised
Speaker 1: by that? Are you surprised by how strong equity markets
Speaker 1: have performed?
Speaker 3: So I think it's definitely good news with especially the
Speaker 3: US exceptionalism narrative, no fading away, no imminent, no global recession.
Speaker 3: The Dotter actually may continue to weaken further, and so
Speaker 3: so far this has acted as a telling for Asian
Speaker 3: and energy markets. So we have seen actually a lot
Speaker 3: of interest moving from the US to elsewhere. People are
Speaker 3: looking for more diversification. And obviously, I mean Asia may
Speaker 3: face some varying degrees of no tariff risk impact, but
Speaker 3: at the moment the situation has de escalated. We are
Speaker 3: seeing more improvement on many fronts, and so as evidence
Speaker 3: of that, the Asian equity markets have done very well,
Speaker 3: not just in China, but also like in the Asian
Speaker 3: region in North Asia, like Taiwan, markets have done very well.
Speaker 3: So yeah, now we are seeing investors increasingly looking beyond
Speaker 3: the US and looking to regions such as Asia, countries
Speaker 3: like Japan and Chinese. So back in the discussion.
Speaker 2: And Jessica, there's been a lot of talk about this
Speaker 2: Cell America trade, and you've alluded to the fact that
Speaker 2: a lot of funds are flowing outside of the US
Speaker 2: into places like Asia. Do you think this trend will
Speaker 2: continue going forward?
Speaker 3: Well, as long as there's a lot of entertainties in
Speaker 3: the US, I mean, this trend may continue. But obviously
Speaker 3: the susue is very fluid. It depends also on you know,
Speaker 3: whether like the usler will rebound, whether the US economic
Speaker 3: growth will do better. So there are a couple of
Speaker 3: variables to take into account, but so far, what we're
Speaker 3: seeing is that investors believe that diversification is crucial in
Speaker 3: their allocations, and especially in times like this, it's very
Speaker 3: important to basically not put all the eggs in the
Speaker 3: same baskets. And so this is where we think that
Speaker 3: emerging market, especially the Asian region, should benefit from it.
Speaker 1: Do you think that's what investors are thinking about, you know, diversification, Like,
Speaker 1: why else would equity markets rally so much when there's
Speaker 1: you know, in times of uncertainty, you think of more
Speaker 1: safety assets as outperforming, but we've seen this incredible strength
Speaker 1: and equities.
Speaker 3: That's a very good question I think we are also
Speaker 3: in a different times compared to the previous trade war.
Speaker 3: Like back in twenty seventeen eighteen, I think this took
Speaker 3: a lot of investors' best surprise, but this time, I mean,
Speaker 3: we are familiar with this narrative obviously, like the magnitude
Speaker 3: of it is a bit different. But since that painful period,
Speaker 3: a number of markets have or worked on, you know,
Speaker 3: divers paying more that trade partners. In the case of China,
Speaker 3: the strategy of the government was to insulate more economy
Speaker 3: but continue to diversify their supply chains to mitigate the
Speaker 3: trade risk. We're also seeing a number of domestic stories,
Speaker 3: especially in the Asian region. There's plenty of domestically led
Speaker 3: growth stories, for example in the Philippines, which has benefited
Speaker 3: from the more favorable global interest rates but also more
Speaker 3: favorable community prices. We think that this offers a lot
Speaker 3: of opportunities for example for the Philippines banks, for the
Speaker 3: indonsial banks as well after the revaluation. So there are
Speaker 3: opportunities to be found outside of the US, especially in
Speaker 3: the Asian region, and that potentially could explain why I mean,
Speaker 3: we have seen such strong like rady in the past
Speaker 3: few months. The other point I want to mention so
Speaker 3: is on the government side, the policy side, we have
Speaker 3: seen much stronger credibility, like for central banks in terms
Speaker 3: of not managing their monetary and fiscal policies. China has
Speaker 3: become even more pro growth, pro business, So all of
Speaker 3: those elements helped contribute to I would say, a more
Speaker 3: constructive view on the Asian markets.
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Speaker 2: And Shair Jessica, how has the tariff and the trade
Speaker 2: war impacted the investment decisions of your firm?
Speaker 3: Yeah, indeed, something that we have been looking at very closely, because,
Speaker 3: as you can imagine, with Asia being an export oriented region,
Speaker 3: the the region has been significantly impacted by the US
Speaker 3: tarif on exports. Obviously, now thoughts. Plus the daughter has weakened,
Speaker 3: so that has acted as a telling for the region.
Speaker 3: But still it's important to monitor this situation very closely.
Speaker 3: So what we have noticed is that not all countries
Speaker 3: should be considered. I mean the same way. Eljia has
Speaker 3: faced varying degrees of tariff impact, so Taiwan Korea, which
Speaker 3: are more export sensative, have felt more impact. But on
Speaker 3: the other hand, China, Indonesia, the Philippines are probably expected
Speaker 3: to be more resilient because of this focus on domestic growth.
Speaker 3: And as a matter of fact, if you look at,
Speaker 3: for example, those messi in disease, you will see that
Speaker 3: the majority of the revenues in Asia are mostly domestically driven.
Speaker 3: That is especially the case for the Philippines for China,
Speaker 3: and on top of that, many countries have already started
Speaker 3: to reduce reliance on the US exports. China is definitely
Speaker 3: the best example, and so that domestic focus should prove
Speaker 3: defensive for those markets.
Speaker 1: Seems like you might have a more constructive view of Asia.
Speaker 1: Then meets the eye if you read you know, headlines,
Speaker 1: because you think about a South Korea, for example, which
Speaker 1: you just mentioned, heavily exposed to trade and the trade war.
Speaker 1: Potentially we'll see once there's an agreement in place. But
Speaker 1: the costp has soared how much did you say that?
Speaker 2: It's almost I think it's the best performing market year
Speaker 2: to date in local currency terms, it's up almost twenty
Speaker 2: one percent. Also, the Hank saying is on fire, that's
Speaker 2: Hong Kong is up almost twenty percent as well.
Speaker 1: So it's sort of like, if you're an investor, thinking
Speaker 1: that the trade war is going to hit these economy
Speaker 1: is really hard, you probably wouldn't be investing so much
Speaker 1: in the equity market, So, you know, is the idea
Speaker 1: that perhaps the trade war won't hit these economies as
Speaker 1: hard as people think.
Speaker 3: So I think there are here very like domestic stories
Speaker 3: that explained why we have seence such rally in the
Speaker 3: case of Korea, and this is probably something that has
Speaker 3: been undermined. The improvements are in copper. Government story is real,
Speaker 3: probably not as advanced as what we're seeing in Japan.
Speaker 3: I think a lot of people are quite aware of
Speaker 3: this improvement on that side, but in Korea we're still
Speaker 3: at the in fancy stage, but things are progressing really
Speaker 3: quite substantially. So we talk about this value up program
Speaker 3: where it's not just pacting a few sectors, but we
Speaker 3: start to see like a change of mindset. Obviously, it
Speaker 3: will take some time, and in the case of Japan
Speaker 3: it took a decade, so I think for Korea was
Speaker 3: still at the beginning. But at least this should help
Speaker 3: broaden you know, this corporate government changed mindset and help
Speaker 3: ultimately like lead to better shop price going forward. The
Speaker 3: other also good news is probably the political entertainties. You
Speaker 3: probably have heard about this political turmoil over the past
Speaker 3: few months and now with the election outcomes, this has
Speaker 3: also brought more clarity. So all those elements helped contribute
Speaker 3: to a more positive outcome for Korea. And in this
Speaker 3: type of market this is well. We think that there
Speaker 3: are plenty we have stock opportunities to be found. But
Speaker 3: once again it's important to be selective because not all
Speaker 3: names will be impacted the same way. We are vigilant
Speaker 3: and those could be suffering from tariff frictions or edgertanties.
Speaker 3: But on the other hand, we try to look at
Speaker 3: the name that are attractive and presenting long term growth stories.
Speaker 2: Jessica, you alluded to domestic oriented companies and economies. Is
Speaker 2: that what JP Morgan is investing in i e. Companies
Speaker 2: that benefit from a domestic consumption lead story as opposed
Speaker 2: to export oriented companies.
Speaker 3: So I think it depends on the different strategies that
Speaker 3: we're looking at. But overall, our PROFULO managers have found
Speaker 3: a lot of built up stock opportunities in a number
Speaker 3: of domestic oriented stories. That doesn't mean that there are
Speaker 3: no interesting exporters. I think if they look at the exporters,
Speaker 3: they try to look at the one that will be
Speaker 3: facing less trade war risks. So for example, those that
Speaker 3: have really like new diversified their supply chains, not just
Speaker 3: with the US, but you know, within the Asian region
Speaker 3: or with the little least, or basically globally. There are
Speaker 3: also other like interesting exporters who may be focusing mostly
Speaker 3: India and not just know like the US. So we
Speaker 3: are trying to look at, you know, those that probably
Speaker 3: will suffer less from those trade risk But on the
Speaker 3: other hand, it's quite obvious that there are plenty of
Speaker 3: domestic stories to be found. For example, when we look
Speaker 3: at the Chinese tech story, we see a lot of
Speaker 3: industry up grades, important constitution story. The focus on sex
Speaker 3: efficiency is becoming very, very obvious. So that means that
Speaker 3: we can find a lot of tech opportunities, especially some
Speaker 3: AI you know proxies, but not just in the hard tech.
Speaker 3: In the software space, there are also plenty of opportunities
Speaker 3: to be found, especially post and deepsick impact. We think
Speaker 3: that there are plenty of good place in this place.
Speaker 3: So we're trying to say that'd be also quite diversified
Speaker 3: in our approach, making sure to pick the best conviction ideas.
Speaker 3: But yeah, that miss states. I think investment managers to
Speaker 3: like be very you know, focused on different diverse areas
Speaker 3: and not just purely like a few buggets. So to
Speaker 3: answer your question, there are plenty of domestic currented stories,
Speaker 3: but I won't say that we're purely invested in this
Speaker 3: area and ignoring the exporters. We're really also trying to
Speaker 3: look at the other global opportunities where the names could
Speaker 3: be less impacted by do straight frictions.
Speaker 1: Yeah, you mentioned Chrya Tech just now. Is there still
Speaker 1: room to find value after deep Sea? It seems like
Speaker 1: there is a big kind of rally that month or
Speaker 1: that week, But where do you see the most value
Speaker 1: in China tech right now?
Speaker 3: That's interesting because deepsea has collision the world that China
Speaker 3: is able to innovate and cheaper price. So when you
Speaker 3: have a very like high performing and you know, at
Speaker 3: a cheaper cost LM model, I mean, this is clearly
Speaker 3: a game changer for a number of sectors. So we
Speaker 3: have spotted a number of opportunities indeed in China in
Speaker 3: this space. First is the AI infrastructure, like all the
Speaker 3: AI servers you know, are becoming a necessity for the market.
Speaker 3: I mean not just for China, but actually globally. This
Speaker 3: is something that the common trend that we're seeing, so
Speaker 3: the AI edge is key. Second, so the AI use
Speaker 3: cases supposed dip sick, we think that the number of
Speaker 3: companies would probably look for more monetization and cost opportimization.
Speaker 3: So we think that there are plenty of opportunities to
Speaker 3: be found in the AI use cases like area. And finally,
Speaker 3: when it comes to automation, I think focusing on profitability
Speaker 3: is key, especially in the aging demographics environment, so it's
Speaker 3: important to look at all those game changing technologies. And
Speaker 3: we think that like humanity, the bots could become the
Speaker 3: next trend. So these are areas that we have been
Speaker 3: exploding in our.
Speaker 2: Shutche Jessica You mentioned quite a few themes there, but
Speaker 2: I wanted to talk about in particular AI and deep Seek.
Speaker 2: And one of the frustrations with a lot of investors
Speaker 2: is been the lack of monetization, especially with a lot
Speaker 2: of technology coming from China. Now we know China's greater innovation.
Speaker 2: You see what they're doing in electric vehicles, also with
Speaker 2: AI LM models, but they're really behind in making money
Speaker 2: out of these, like Deep Seek doesn't make that much
Speaker 2: money compared to someone like open Ai. Is that a
Speaker 2: risk that there's just so much competition in these sectors
Speaker 2: that leads to price wars. Some services you don't even
Speaker 2: have to pay for.
Speaker 3: We're SAI at the beginning, so you know, things can
Speaker 3: evolve very fast, and especially in the case of China,
Speaker 3: the market took claus surprise a lot of investors about
Speaker 3: the digital story, and so I think it's probably too
Speaker 3: early to have a definite entry on this. That said,
Speaker 3: it's true that in China it is extremely competitive, and
Speaker 3: what deepsy has brought is clearly like a big revival
Speaker 3: of the animal spirit, and clearly the corporate sentiment has
Speaker 3: been strongly boosted. So there are areas that we probably
Speaker 3: do better compared to others, and this is where we
Speaker 3: want to be extremely cautious and selective. So you mentioned
Speaker 3: about ev I think that's definitely an interesting sector to
Speaker 3: discuss because this is an area where we like to
Speaker 3: spend time in China has been extremely advanced in this field,
Speaker 3: and not just EVY but in the solar space. I mean,
Speaker 3: the China has a very dominant position there. But we
Speaker 3: won't jump into any type of ev OEMs for example.
Speaker 3: Here we want to be selective because the competition is
Speaker 3: extremely intensive and so when we think about the long
Speaker 3: term trajectory of the ev supply chain, we think that
Speaker 3: there's clearly a long way to go. But we want
Speaker 3: to focus probably a bit more on the energy battery
Speaker 3: or story because that would become very strong growth drivers,
Speaker 3: especially for the supplection related businesses, rather than you know,
Speaker 3: the ev o ems where it's extremely competitive. So in
Speaker 3: other words, we are constructing our bets mostly on you know,
Speaker 3: the suppliers with better or more favorable demand supply structure.
Speaker 3: So for example, these IV batteries, the power semis are
Speaker 3: very interesting and we also looked for the companies that
Speaker 3: present very high barriers to entrigue whether it is in
Speaker 3: terms of cost or capital investment or technology. I think
Speaker 3: that the one you know, with a strong pressing power
Speaker 3: will do better versus the others.
Speaker 1: Humanoid robots, how do you get exposure to humanoid robots?
Speaker 2: Many of them are not listed all the very small
Speaker 2: these companies.
Speaker 3: So we're trying to look at more the names that
Speaker 3: will contribute to those end products. So for example, in
Speaker 3: the automation space, they're trying to look at, you know,
Speaker 3: names that are basically providing like the other resources so
Speaker 3: that they can achieve this end goal.
Speaker 1: So like the metal or the screws or the chips
Speaker 1: maybe exactly.
Speaker 3: So this is the same by the way, for EV's
Speaker 3: not just about know like the EV cars. As I said,
Speaker 3: we are focusing on those TV suppliers, the EV batteries,
Speaker 3: IV storage system, but also the power like semans that
Speaker 3: will be fed into the end product.
Speaker 2: But do you see humanoid robotics or robot companies as
Speaker 2: like is this going to be a multi theme?
Speaker 3: Well, same words at the very beginning, So anything is possible.
Speaker 3: But according to our investment team, they do split a
Speaker 3: lot of interesting elements into it, and we are starting
Speaker 3: to see not just in China, but globally a lot
Speaker 3: of entresation about many the robots. So yes, we think
Speaker 3: this is going to be a long term trend. Let's
Speaker 3: see how things will play out.
Speaker 1: One more question on humanoid robots. Maybe we should do
Speaker 1: an entire episode at some very specific human oild robots.
Speaker 1: But as someone who looks at these companies and sort
Speaker 1: of use cases, I mean, what's your vision or how
Speaker 1: how does the team see humanoid robots playing out? Is
Speaker 1: it more on on sort of assembly lines, is it
Speaker 1: military applications and sort of what's the what's the time horizon?
Speaker 3: Well, our team usually keep a very long term, you know,
Speaker 3: investment horizon mindset, and they believe that nowadays in the
Speaker 3: number of economies, we're seeing aging demographics and there's also
Speaker 3: a very strong need to boost to profitability. Obviously, it
Speaker 3: will be very difficult to replace some labor forces. In
Speaker 3: the case of Japan, I think it's quite obvious. So
Speaker 3: our research team believes that actually do human aid robots
Speaker 3: could play a very important role in filling those gaps.
Speaker 3: So it will not just help the current labor force,
Speaker 3: but it will also help improve the productivity of people
Speaker 3: so that I can spend more efficiently time on other tasks.
Speaker 3: So it's not necessarily like I would say, at this
Speaker 3: point in time, like military, like related. I mean to us,
Speaker 3: this remains quite a sensitive area to invest, but we
Speaker 3: think that it's more like on the productivity level, those
Speaker 3: newer elements could bring a lot of positive change and
Speaker 3: that's why they believe that this is definitely part of
Speaker 3: the long term growth stories that we want to explain.
Speaker 3: One on that front is still the very beginning, but
Speaker 3: we think that this could bring definitely a good opportunities
Speaker 3: in a living one.
Speaker 2: Jessica, I wanted to also talk about another big trend,
Speaker 2: and that's the growing influence of females or the Shei
Speaker 2: economy in China. And what I mean by she I
Speaker 2: mean yeah, as I said, females not president, she women president.
Speaker 2: But for the benefit of the listeners, some of these
Speaker 2: stocks that are related to females driving consumption have really skyrocketed.
Speaker 2: Now PopMart, it's listed in Hong Kong. They make the
Speaker 2: famous Labu Boo dolls. That's up over two hundred percent.
Speaker 2: Did you want to explain what Labuoboo dolls are.
Speaker 1: For our dear listeners who are not aware of the
Speaker 1: popularity of blue Boo Boo dolls. There are these kind
Speaker 1: of gremlin like little dolls that you put on your keychain.
Speaker 1: They go on a keychain, you can put them on
Speaker 1: bags and stuff, and I believe that they were popularized
Speaker 1: by a lot of K pop celebrities. I think it
Speaker 1: was Black Pink actually that yeah, yeah, who drove the
Speaker 1: cruse And there was one that sold recently at auction
Speaker 1: for about one hundred and fifty thousand US dollars, like
Speaker 1: a bigger version of it.
Speaker 2: But that's stock now, it's it's multi billion dollar into
Speaker 2: the market cap. It's up two hundred percent. There's another
Speaker 2: cosmetics company it's up over one hundred percent. Is this
Speaker 2: a big theme that you see unfolding and going forward?
Speaker 3: Jessica, Indeed, we have seen actually this thing becoming a
Speaker 3: big trend. It was it took a lot of investors
Speaker 3: by surprise because it almost came from nowhere, know, like,
Speaker 3: it was very surprising. And I think that this is
Speaker 3: also part probably of the change in nor mindset in
Speaker 3: the market. I know, after tough period during COVID, you
Speaker 3: all the challenges related to that, those regulation, the properly downturn.
Speaker 3: People are maybe just want to enjoy like simple things,
Speaker 3: and probably I mean this has contributed to the search
Speaker 3: of such a consumption product. So yeah, we think it's
Speaker 3: aligned with you know, the some nutrends the conception that
Speaker 3: we're seeing in China. But one thing that to us
Speaker 3: would be very key to follow is to see whether
Speaker 3: this consumption recovery will take a stronger pace. For now,
Speaker 3: it has been quite muted simply because, yeah, it takes
Speaker 3: a lot of patients for people to see there are
Speaker 3: no confidence recovering, especially when you know, the problem market
Speaker 3: has been really tough and we have seen some negative
Speaker 3: wealth effects. I mean, this is not easy. But the
Speaker 3: positive aspect about China is that although like consumption, you know,
Speaker 3: like a confidence is still low at the moment, there
Speaker 3: are money in China. I mean, there's no lack of
Speaker 3: money in China. Basically what is missing is the willingness
Speaker 3: to spend this money because of those properly downturned, the
Speaker 3: negative wealth effects and those sort of job prospects, especially
Speaker 3: at least past few years. So if we see any
Speaker 3: gain in confidence in China, that could be highly significant
Speaker 3: and can help also like bring even more opportunities in
Speaker 3: consumption space.
Speaker 1: And do you see consumption in China? Maybe we could
Speaker 1: talk about the broader region here in Asia as well,
Speaker 1: but do you see that consumption lasting through the end
Speaker 1: of the year, at least for now, because that would
Speaker 1: you know, it's a little booboo. It's cosmetics companies, it's
Speaker 1: a range of service providers as well, like restaurant chains
Speaker 1: for example. So do you kind of see that continuing
Speaker 1: through your end?
Speaker 3: We think that would continue. But this is where we're
Speaker 3: extremely selective. We think that the areas that would benefit
Speaker 3: from those long term opportunities are the ones that probably
Speaker 3: at the moment, would be benefiting the most from the
Speaker 3: cella's similar expansion. So, for example, you know, all those
Speaker 3: areas which are for now presenting attractive evaluation, even the
Speaker 3: internet names in China that are more consumer facing, the
Speaker 3: names that are benefiting from the fiscal stimulus measures, those
Speaker 3: infrastructure no clapex beneficiaries, those areas should probably do better,
Speaker 3: especially if they have strong pressing power. But we want
Speaker 3: to be selective because not everyone in this game will win,
Speaker 3: especially in a very competitive environment, So we want to
Speaker 3: look at the names that not only present strong pressing power,
Speaker 3: but also very strong competitive advantage. In the consumption space.
Speaker 1: Which sectors fall on both sides of that, which sectors
Speaker 1: in China consumption space would be beneficiaries and which would
Speaker 1: be a bit more at risk, like I had mentioned,
Speaker 1: like restaurant chains for example, or maybe mall owners. Are
Speaker 1: there certain specific kind of sectors that you like more
Speaker 1: and those that are maybe not so great?
Speaker 3: Yeah, so I think that, for example, you mentioned rationians,
Speaker 3: so we do like a couple of them. The Internet
Speaker 3: names are so very interesting because not just the growth stories,
Speaker 3: but also like the improving the copper government stories, the
Speaker 3: share buybacks. We look at the Internet names that are
Speaker 3: more consumer facing, and then I would say also all
Speaker 3: those beneficiaries like greed or the one that benefit basically
Speaker 3: from all those physical stimulus measures, we think these should
Speaker 3: do quite well. So that's the type of areas that
Speaker 3: we like. On the other hand, we're a bit more
Speaker 3: cautious on all those consumer names which are very like
Speaker 3: expot oriented for obvious reasons, because of those storyff you know,
Speaker 3: friction and certainties. Even if now the stustion is getting better,
Speaker 3: I mean, who knows what will happened in July once
Speaker 3: you know the Natiday reprieve is behind us. So, yeah,
Speaker 3: so we try to be extremely selective in this space.
Speaker 2: Just we've talked about a lot of different countries, sectors,
Speaker 2: we talked about a lot of different themes or thematic
Speaker 2: way of investing. How does JP Morgan, what's the investment process? Like,
Speaker 2: how do you distill all these ideas into investing in stocks.
Speaker 3: So I think it's very important to have a very disciplined,
Speaker 3: long established process that we are not refining over time.
Speaker 3: But being consistent in our approach is extremely important, especially
Speaker 3: during those certain times because it's obviously very easy to
Speaker 3: follow the noises or to panic. But in this case,
Speaker 3: we think when we have a very well established framework,
Speaker 3: it's much easier than to build stronger conviction in our names,
Speaker 3: even if there could be some shortened you know, times
Speaker 3: of ncertainties. So that way, this has helped us really
Speaker 3: like you know, stick to our highest conviction, like you know, holdings,
Speaker 3: and we mentioned a lot about China opportunities, but this
Speaker 3: is not the only area where we see opportunities. The
Speaker 3: Asian region is also full of long term structural growth
Speaker 3: opportunities the customer space because you know of the growing
Speaker 3: in the class we STI also opportunities in financials and greeds,
Speaker 3: whether it is in the Philippines and Singapore and Indonesia.
Speaker 3: And one market that probably has been neglected for a
Speaker 3: long long time because this market has been unloved and
Speaker 3: their own for long time is Japan. Japan, because we
Speaker 3: are seeing a big corporate governance revolution taking place even
Speaker 3: more over the past two years. As I said earlier,
Speaker 3: it took a decade for Japan to now see much
Speaker 3: more you know, improvement, but clearly like the TSC reforms
Speaker 3: has been a tremendous change, and now we're seeing more
Speaker 3: attractive risk reward opportunities because of I mean thanks to
Speaker 3: the copper governance reforms to return to inflation. So for example,
Speaker 3: there are opportunities to be found in automation, gaming, IP, digitalization.
Speaker 3: There's plenty of exciting stories to be found in Japan,
Speaker 3: but it's very important to understand, you know, the macro
Speaker 3: environment and also to differentiate I would say the Macrones
Speaker 3: situation from the stock selections is that because you know,
Speaker 3: the economy is growing like slow, that you cannot find
Speaker 3: exciting earnings beneficiaries in Japan. So the same here we
Speaker 3: are trying to be diversified inspective in the space.
Speaker 1: Well, thank you so much for joining us today.
Speaker 3: Thank you, Joan.
Speaker 1: You've been listening to Asia sandtrack from Blueberg Intelligence.
Speaker 2: I'm cartidmitary of on Hong Kong, and I'm John Lee,
Speaker 2: also in Hong Kong. You can listen to all our
Speaker 2: episodes on Apple Podcasts, Spotify or where you listen and
Speaker 2: this episode was produced and edited by Clara Chen.
Speaker 1: Thanks for listening, See you next week.