_png.png)
Market Review and Strategies
After decades of investing in the global equity market, we share our experience in diversifying the portfolio across different regions and sectors. We focus on companies with solid fundamentals and high growth potential, with clear communication that reflects our investment strategy and keeps us regularly informed about performance.
Trump 2.0
TSMC’s quarterly profit jumped 36% in the 2nd quarter of 2024 to USD7.6b, buoyed by generative AI products. 2nd quarter revenues rose 32% to USD20.82b. According to management, they expect 3rd quarter revenue to jump to USD23.2b, supported by strong smartphone and AI-related demand (consensus forward PE is 26X. Source: Yahoo Finance).
With such strong reported earnings, one would expect the tech sector to continue its strong momentum but no one expected Trump to announce that he is at best lukewarm about defending Taiwan against China’s aggression post TSMC’s results.
The world and businesses will go on, but risk premium will rise for now with Trump’s rhetoric. While we believe that S&P500 will range bound till the US Presidential election, opportunities exist but we need to diversify into non-tech US stocks with unique strength and preferably domestic centric. After all, US markets are generally down 3 months prior to US election. We will raise our cash level for now to be defensive and avoid anything that Trump threatens to impose a substantial import tax. We believe AI related stocks will still be winners after looking at TSMC’s results but will wait for the dusk to settle from Trump’s rhetoric. After all, tech valuations at high 20x are not excessive. We will look for champions on their own right.
3rd Quarter 2024
We anticipate continued market uptrends in the second half of 2024, albeit with mild consolidation due to stretched technical indicators. Despite potential volatility from inflationary pressures and geopolitical risks, positive economic growth and earnings, particularly in the tech sector, support a favorable outlook. The US Fed's recent press conference and strong performance from companies like Nvidia further bolster market prospects, while China's recovery, despite some challenges, adds to the optimism.
.
2nd Quarter 2024
Our thorough analysis of US inflation, US tech valuations, Chinese equities, and global market trends underscores our strategic focus on AI investments and undervalued assets in ASEAN markets, reflecting our commitment to delivering sustained performance and seizing lucrative opportunities.
.
1st Quarter 2024
In 2023, the US equity market surged on the anticipation of rate cuts, bolstering our portfolio, although underperformance in the Hong Kong/China market tempered gains. Key factors impacting markets included geopolitical conflicts, currency strength, rising interest rates, recessionary fears, and China's economic deceleration. Despite these challenges, we anticipate growth in 2024, with bonds taking the lead as economic expansion moderates.
.