HSBC hosted a virtual press conference to discuss the outlook for the global and Asian economies, and the financial markets in the Year of the Tiger on 17 January 2022.
Analyst forecasts that Bank Negara Malaysia will be very likely to hike the interest rate to 50 basis points this year as a normalization process. The Malaysian equity market has been overweight and thus, posed to have downward pressure on the market. Growth prospect is said to be lagging Indonesian market.
Volatilities are expected in the global equities markets this year.
On Asian market, the fastest growth equities would be in Indonesia and Philippines. Overweight on the Indonesian, Filipino, Taiwanese equities markets while cautious on the Korean equity market. Investors may look for low valuations in some Asian markets.
Analysts find China equity market has attractive valuation and growth prospects. Industry that investors should look at is energy stocks especially the renewables. While investors should be cautious on the property and internet-related stocks.
Asian currencies are expected to be resilient in 2022 as they are better positioned to ride it out this on the back of slowing / cooling global economy while USD is expected to be strong this year.
For Southeast Asian economies, the biggest wild card is still the Omicron-variant that could pose a sharp and short impact.
In line with the ESG principle, there would be increase in the green financing as governments are pushing for the issuance of green bonds as the decarbonization process is taking place.