US & China Market Outlook Feb 2022 | Ewpple

 

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Ewpple - US & China Market Outlook Feb 2022

US Market

• Volatility and weakness in the equity market are expected due to inflation, strong jobs data, and a more hawkish Fed stance.
• Rising rates make valuations unjustifiable.
• Any earnings miss will cause the tech and growth stocks to crash.
• S&P Value Index will outperform S&P Growth Index.
• Analysts advise to sell into equity rallies.
• Past 1 year returns for SPY: +17%

China Market

• In the Year of the Tiger, the regulatory crackdown on technology will help existing companies expand and strengthen their moats.
• An easing of both monetary and fiscal policy may steer investors toward China.
• There is still uncertainty and the market hasn't bottomed out yet.
• The zero-Covid policy may negatively impact GDP growth and the global supply chain.
• The consumer goods sector should do better due to its non-cyclical nature.
• The key to investing in China's equity markets is diversification.
• Past 1 year returns for MCHI: -33%

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