Entries by Affin Hwang Asset Management

China NPC: Pivot towards Quality Growth

China’s annual National People Congress (NPC) comes to a close soon after a 2-week parliamentary session. In the following interview Huang Juin Hao, Senior Portfolio Manager of Affin Hwang AM gives a rundown what happened in the NPC and market implications 1) What were the key takeaways of China’s NPC this year? At the NPC, the government work report targets for 2019 have been announced and most of the targets have been largely in-line with market expectations. The keys numbers were for GDP growth to come in between 6% – 6.5%, which would represent a slowdown from 2018’s 6.6% growth. The government has placed particular emphasis on creating 11 million new urban jobs and keep registered urban unemployment rate within 4.5%. Tax cuts in VAT (value-added tax), corporate and households would also provide relief amounting to RMB 2 trillion, which was the same as 2018’s prior announced business tax shift to VAT. 2)  Were there any surprises this year that went against market expectations? There were 5 surprises which differed from market expectations i.The fiscal deficit which the government expected to come to 2.8% of GDP. Market expectations were for the deficit to be at 3.0%, given tax cuts of […]

Staying Defensive in Healthcare

Against a challenging backdrop, the healthcare space was one of the best performing sectors in 2018 due to its low sensitivity to global growth.  In the following interview, Erin Xie, Head of Health Sciences, Fundamental Active Equity of BlackRock shares her outlook for the healthcare sector and its late-cycle potential to outperform.   Q1)  How did the healthcare sector perform overall in 2018 as volatility jolts? Also, as the late-cycle approaches, how do you see the sector performing moving forward? 2018 was an eventful year for global equity markets, with significantly more volatility than in the past 10 years. Performance for the MSCI World Index was more than -5% negative and this was a stark reminder to investors that despite the experience of the last 9 years, equity markets don’t always go up and to the right.  One of the bright spots during the year was the healthcare sector, which delivered more than 2% outperformance over the full year and displayed relative stability in a volatile market. Looking at the historical analysis of sector performance through market cycles in the past 25 years, healthcare has consistently outperformed other sectors during late cycle and recessionary periods. For example, the healthcare sector […]

Affin Hwang AM Launches Global Healthscience Fund

 KUALA LUMPUR – Affin Hwang Asset Management Berhad (“Affin Hwang AM” or “the Company”) announced the launch of Affin Hwang World Series – Global Healthscience Fund (“the Fund”). The Fund is a wholesale feeder growth fund that provides access to broad opportunities in healthcare by investing in a collective investment scheme, namely BlackRock Global Funds World Healthscience Fund (“Target Fund”). The Target Fund is a Luxembourg-domiciled fund managed by BlackRock (“Target Fund Manager”). To achieve its investment objective, the Fund will invest a minimum of 80% of the Fund’s net asset value (NAV) into the Target Fund and a maximum of 20% of the Fund’s NAV into money market instruments, deposits and / or liquid assets. Chan Ai Mei, Chief Marketing & Distribution Officer of Affin Hwang AM said, “Quality is key as markets approach a late-cycle environment. With global growth rates likely to have peaked in this current cycle, the healthcare sector provides investors a defensive shelter to weather against volatility and also tactically diversify. Historically, the healthcare sector has shown a low sensitivity to global growth displaying resilient earnings in a mature market cycle.” “Underpinned by positive demographic and innovation trends, we see secular growth drivers that would […]

Announcement of YM Raja Tan Sri Dato’ Seri Aman bin Raja Haji Ahmad as Chairman of Affin Hwang Asset Management Berhad

KUALA LUMPUR – Affin Hwang Asset Management Berhad (“Affin Hwang AM” or “the Company”) announced the appointment of YM Raja Tan Sri Dato’ Seri Aman bin Raja Haji Ahmad as its new Chairman of the Board effective 19 February 2019. YM Raja Tan Sri Dato’ Seri Aman held various positions in the Maybank Group from 1974 to 1985 prior to joining Affin Bank Berhad as an Executive Director. In 1992, he joined Perbadanan Usahawan Nasional Berhad as its CEO before he was re-appointed as the CEO of Affin Bank Berhad in 1995. He had served as a member of the National Pension Fund’s (KWAP) Investment Panel and he is currently the Chairman of Lembaga Tabung Angkatan Tentera’s (LTAT) Investment Committee. He had also served as a member of the Malaysian Government’s Working Group Policy of the Special Task Force to Facilitate Business (PEMUDAH) for a period of ten (10) years from 2007 to 2017. YM Raja Tan Sri Dato’ Seri Aman is the Chairman of Ahmad Zaki Resources Berhad, and also sits on the Board of Affin Hwang Investment Bank Berhad as well as Tomei Consolidated Berhad. A graduate from Universiti Malaya, YM Raja Tan Sri Dato’ Sri Aman is […]

Affin Hwang AM Market Outlook 2019: Riding Out Market Cycles

KUALA LUMPUR – Affin Hwang Asset Management Berhad (“Affin Hwang AM” or “the Company”) believes that global economic growth is poised to continue on an even keel with expectations of single-digit growth returns this year as the economic cycle matures. Emerging markets (EMs) started 2019 on a strong note buoyed by trade optimism and policy support coming in from global central banks to shore-up the market. In a media press briefing today, Teng Chee Wai, Managing Director of Affin Hwang AM said, “After the rout in EMs last year, we do see some of these headwinds now receding with the US Federal Reserve turning more dovish and the US dollar strength starting to top-out. Currently, Fed funds futures are pricing-in for a pause in interest rates this year with a chance of a rate cut in 2020.” “Easing measures announced by China has also propped up the market, though closer monitoring would be needed to see if such stimulus has started to trickle-down to growth and GDP possibly sometime into the 2Q’19 due to lag effects. China’s growth responds well to the creation of liquidity and we need to see credit translating to higher velocity of money and transactions that […]

US-China Trade Talks: Down to the Wire

With just two weeks left until the trade truce deadline, will we finally see the US and China come around the negotiation table to strike up a deal and end a bitter trade conflict that has lasted over a year? In the following interview Huang Juin Hao, Senior Portfolio Manager shares the possible scenarios of the trade talks and market implications. 1) Trade negotiations between US and China are currently ongoing, but the 90-day truce period is set to end on 1 March 2019. What are your expectations of the talks and possible outcomes? Our expectations have shifted. Towards the end of 2018, the market was expecting higher odds of an escalation or widening of trade tariffs against China. This was in part, due to the extremely short time period available for negotiations due to US Christmas holidays in December’18 and China’s Chinese New Year holidays in February’19. However, the market has since moved their expectations towards a higher probability of a neutral or positive outcome for trade talks after more conciliatory signals from both China and US. In latest news, US President Donald Trump has expressed willingness to extend the March 1st deadline, while Chinese President Xi Jinping and […]

Affin Hwang AM Lists New China ETF on Main Market of Bursa

KUALA LUMPUR – Affin Hwang Asset Management Berhad (“Affin Hwang AM” or “the Company”) announced the expansion of its exchange-traded fund (ETF) offerings with the launch of the TradePlus S&P New China Tracker (“Fund”) that was successfully listed on the Main Market of Bursa Securities today. The Fund is an equity ETF that provides investors exposure to China’s new economy and to participate in positive growth trends and consumption patterns within its changing economic structure, as it transitions from an investment-driven to a consumption & services-led economy. Benchmarked against the S&P New China Sectors Ex A-Shares Index(1) (“Benchmark”), the Fund will employ a full replication strategy to closely track the performance of the index, providing an efficient manner for investors to gain broad exposure to Chinese listed companies in its fast-growing consumption and service-oriented industries. To meet its investment objective, the Fund will invest a minimum of 70% of the Fund’s net asset value (NAV) in authorised securities(2), with an option to invest a maximum of 20% of the Fund’s NAV in derivatives and/or collective investment schemes. The remaining balance shall be invested in money market instruments and/or deposits for liquidity. Teng Chee Wai, Managing Director of Affin Hwang AM […]

Fixed Income Outlook 2019: Asian Bonds Back in Vogue

In the following interview Esther Teo, Director of Fixed Income, Affin Hwang Asset Management shares her outlook for the Asian bond market as conditions start to ease after a turbulent 2018 and why credit selection is key in a late-cycle. 1) What are your expectations and outlook for the fixed income market in 2019? The global fixed income space endured a challenging stretch over the past year as the US Federal Reserve continued to hike rates in 2018. Emerging market bonds sold off sharply due to a surge in the USD and specific EM country currency crisis such as in Turkey and Argentina, which prompted a reversal of flows from EMs back to the US. Heightened trade tensions between US and China also dampened sentiment in the region. Looking forward to 2019, we expect to see some of these headwinds recede as we approach the end of the tightening cycle. More dovish comments from Fed Chair Jerome Powell suggests that the central bank would be more patient and accommodative in steering its rate-hike cycle and unwinding its balance sheet. Currently, Fed funds futures are pointing towards zero rate hikes for 2019 and a chance of a rate cut in 2020. […]