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Speaker 1: Let's getting nowt to our guests. Selena see ahead of

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Speaker 1: greater China equity research at Credit Swiss Wealth Management. She

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Speaker 1: joins us from Hong Kong. Was looking at the president

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Speaker 1: she's planned visit to Central Asia this week and whether

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Speaker 1: or not that's a risk to China assets if it

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Speaker 1: leads to closer economic ties with Russia, or whether it's

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Speaker 1: an opportunity here if you look at the fact that

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Speaker 1: he's leaving China for the first time in a thousand days,

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Speaker 1: does that suggests some normalcy could remain and we could

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Speaker 1: see an easing of dynamic zero after the Party Congress.

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Speaker 1: I think it's The answer is to fold. One is

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Speaker 1: that UM, when the Communist Party leader is ticking off

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Speaker 1: from the mainland before the twentieth Party Congress, it was

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Speaker 1: sad that probably he's more relaxed about the local situation.

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Speaker 1: In other words, the local situation can be quite under control. However,

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Speaker 1: when he's ticking off from the mainland. UM for other countries,

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Speaker 1: that would also suggest uncertainties in terms of political tension.

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Speaker 1: UH and UH. The result from the visage you've turned

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Speaker 1: neutral though on the China equity stories as a whole.

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Speaker 1: Tell us why you've made that change from neutral to

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Speaker 1: overweight given the fact that if we do see some

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Speaker 1: change in policy, I mean, you would think that would

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Speaker 1: be a positive boon for China's economy and for equities.

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Speaker 1: I think for a few reasons. One is that the

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Speaker 1: economic situation in China deteriorated more severely compared to what

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Speaker 1: we had previously expected in terms of one UH the

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Speaker 1: COVID outbreak UM. Secondly UM the power shortage, and I

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Speaker 1: in terms of external pressure UM, the US China treat

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Speaker 1: tensions seemed to be re emerging, and a coupled with

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Speaker 1: the fact that UM the policy stimulus that we had

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Speaker 1: seen so far from the Chinese government seems to be

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Speaker 1: less effective compared to what would expected, so UM we

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Speaker 1: choose to be more cautious and therefore downgraded our trying

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Speaker 1: equities from over weight to neutral. There has been some

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Speaker 1: potentially good news though, for the tech space, and when

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Speaker 1: we've got ten Cent winning this approval for a new

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Speaker 1: game for the first time since regulators froze all those

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Speaker 1: licensing agreements in one do you see that as a

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Speaker 1: positive sign for the overall tech space UM. I think

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Speaker 1: in terms of the overall tax space UM that will

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Speaker 1: still be some uncertainty going forward in the way that

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Speaker 1: we've seen some policy issues, uh surrounding some of the

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Speaker 1: tax players, and we've also seen some major shareholders unloading

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Speaker 1: um some of the tech company's shares, and therefore those

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Speaker 1: would still be uncertainties are going forward in the immediate

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Speaker 1: and a medium of future, and therefore we tend to

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Speaker 1: be more cautious on the sact as a whole. And

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Speaker 1: of course those delisting concerns, as you rightly point out,

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Speaker 1: are still going to prevail there too. When it comes

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Speaker 1: to the property space, I mean, this is one area

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Speaker 1: that no matter what we see from the Party Congress

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Speaker 1: in terms of potentially a pivot away from those very

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Speaker 1: strict COVID policies which are hampering the economy, still remains.

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Speaker 1: I mean, you still have people not being able to

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Speaker 1: potentially pay their mortgages or these developers not having started

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Speaker 1: a lot of the developments. How worrying is that in

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Speaker 1: terms of not only investing in property and China, but

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Speaker 1: the overall economic picture. I would think that UM, I

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Speaker 1: think the government is watching closely on the situation, given

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Speaker 1: the fact that that sector is quite crucial in terms

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Speaker 1: of deciding the overall health of the economy. Having said that,

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Speaker 1: the sector as a whole had been very highly fragmented

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Speaker 1: and therefore arguably is overdue for consolidation UM. Going forward

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Speaker 1: medium to long term, I would believe that the major

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Speaker 1: state entities in the sector are likely going to consolidate

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Speaker 1: some of the smaller players that would be UH less

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Speaker 1: in terms of geographical UM exposure in the country, and

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Speaker 1: therefore the bigger ones would become bigger and the smaller

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Speaker 1: ones are likely going to face out. So I would

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Speaker 1: think I would think that the sector will present some

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Speaker 1: kind of investment opportunity at this point, especially the share

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Speaker 1: prices have been quite weak, and mainstream real estate developers

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Speaker 1: maybe the winner overall in the long run. Well sort

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Speaker 1: of further targeted policy support you're expecting though for the

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Speaker 1: property sector UM we can be talking about UM credit

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Speaker 1: easing UM for some of the developers. UM. We can

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Speaker 1: also be talking about some mortgage or preferential rates for

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Speaker 1: potential buyers. So as a whole, I think there can

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Speaker 1: be more stimulus coming forward UM for the real estate

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Speaker 1: sector as a whole in order to support them. The

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Speaker 1: whole sector. When we look at the the UE, a

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Speaker 1: lot of the weakness here is about this this dollar strength,

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Speaker 1: because we're seeing it reflected in a number of em currencies.

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Speaker 1: But there does seem to be this uh, psychological line

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Speaker 1: in the sand when it comes to the seven to

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Speaker 1: the dollar level. We're gonna be looking ahead to see

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Speaker 1: whether or not we get a fifteen straight fix of

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Speaker 1: as stronger than expected bias today. What are you reading

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Speaker 1: into the moves by the PBOC And do you think

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Speaker 1: in a way they don't even mind if it does

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Speaker 1: depreciate a little further. I think we've seen some actions

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Speaker 1: by POC previously, um when the extrege rate hit at

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Speaker 1: a certain level, and therefore UM, I think they do

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Speaker 1: mind um whether or launch um the effects exchange is

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Speaker 1: are depreciation too quickly for the c n Y and

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Speaker 1: UM therefore um yeah UM. If you were to look

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Speaker 1: at your four economies, the United States is raising rates uh,

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Speaker 1: China is um declining in terms of rates, and therefore

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Speaker 1: UM the depreciation of CEN why I thinkst theyr stallar

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Speaker 1: is pretty much expected. UM, but I don't think the

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Speaker 1: PDOC would like to see the depresearch depreciation to come

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Speaker 1: through quickly and to um sharply. And therefore um, we

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Speaker 1: might be expecting some kind of action from the PBOC.

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Speaker 1: Let's talk about Hong Kong where you are as well too.

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Speaker 1: We're hearing this news that Hong Kong may let COVID

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Speaker 1: travelers skip the infamous pennies, by which I'm for anyone

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Speaker 1: living in Hong Kong is is very good news. We're

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Speaker 1: also looking at potentially the end to hotel quarantine itself

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Speaker 1: by November as well. How are things on the ground.

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Speaker 1: How do you kind of view investing in Hong Kong

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Speaker 1: amidst all the uncertainties? I think in the way that

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Speaker 1: Hong Kong's gradually opening up already, and we've seen the

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Speaker 1: airlines UM providing more routes UM, both our long haul

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Speaker 1: and our short haul, and therefore, comparing you on year,

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Speaker 1: the situation is already improving quite a large um and

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Speaker 1: UM the current situation UM. Arguably we're still in kind

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Speaker 1: of a quarantine most um for in bound travelers UM,

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Speaker 1: but UM comparing last year, we're already improving, so hopefully

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Speaker 1: towards the early twenty three UM, the policy can relax

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Speaker 1: a little bit when the situation of COVID improves a

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Speaker 1: little bit in the in the city. So we're quite

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Speaker 1: hopeful for the whole recovery to come through in time,

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Speaker 1: and as Hong Kong then roll back because you've got

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Speaker 1: so many comparisons to see the Paul rents their rising

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Speaker 1: as people exit Hong Kong once restrictions that is, does

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Speaker 1: the appeal of Hong Kong remain? Um I think, um

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Speaker 1: Hong Kong remains quite an attractive a location in terms

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Speaker 1: software investment because it's very close to the mainland, as

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Speaker 1: in fact we are part of the mainland, and therefore

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Speaker 1: if mainland represents a a meaningful kind of market in

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Speaker 1: terms of growth over the long run, um I think

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Speaker 1: Hong Kong will definitely are benefits in time. All right,

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Speaker 1: we'll wait to see as well how the markets reopened

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Speaker 1: this morning and what we get from the PBOC in

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Speaker 1: terms of the fix as well. Selena, Thank you. Selena.

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Speaker 1: See ahead of Greater China equity researcher credits Weeze Wealth

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Speaker 1: Management