bearish
Hang Seng Index Constituents 16th June 2022
SUMMARY
- A better way to think of the Hong Kong Market in the current cycle is that it has both US & China's economic headwinds and requires sharply lower rates and currency to correct macro imbalances.
- HKMA should be cutting interest rates, but it cannot do so due to the currency peg.
- Over the last 12-18 months, Hong Kong developers have enjoyed stability in expectations of reopening borders, investment demand, strong balance sheet compared to mainland developers, and low funding costs (HIBOR). These tailwinds are now headwinds.
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