SINGAPORE: After a sell-off in the first week of September, observers stated that Asian stock markets can rebound and remain robust despite volatility. They also noted that global growth has not collapsed and that US interest rate cuts may help the equity markets.
While activity is slowing, it is not stalling,” according to US economic data, expressed with relief Mr. James Cheo, HSBC Global Private Banking and Wealth’s chief investment officer for Southeast Asia and India. The markets have realised that the Bank of Japan will be very slow in tightening, even though tech companies are generating strong earnings.
Once the volatility subsides, we think global and Asian equities can recover from earnings growth, rate cuts and high cash balances that can be put to work,” he told CNA.
His remarks followed a steep decline in Asian markets on Wednesday, September 4, which was brought on by several factors, including a dip in the US manufacturing data and a 9.5% decline in the shares of Nvidia. This company makes artificial intelligence chips.
In the next six months, global equities markets should rise, according to Mr. Cheo, since economic growth is expected to be supportive and the US economy looks to be headed towards a soft landing rather than a recession.
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