February 2003 Hong Kong Baptist University 1998 Superannuation Fund HSBC Asset Management (Hong Kong) Limited 15/F Citibank Tower, 3 Garden Road, Hong Kong Telephone: +852 2284 1111 Facsimile: +852 2845 0226 Web site : www.assetmanagement.hsbc.com.hk 2H 2002 investment review
Hong Kong Baptist University 1998 Superannuation Fund. 2H 2002 investment review. HSBC Asset Management (Hong Kong) Limited 15/F Citibank Tower, 3 Garden Road, Hong Kong Telephone: +852 2284 1111 Facsimile: +852 2845 0226 Web site : www.assetmanagement.hsbc.com.hk. February 2003. - PowerPoint PPT Presentation
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February 2003
Hong Kong Baptist University1998 Superannuation Fund
HSBC Asset Management (Hong Kong) Limited15/F Citibank Tower, 3 Garden Road, Hong Kong
* Bonds: Salomon Smith Barney World Government Bond Indices** Equities: USA (S&P 500), UK (FTSE-100), Germany (DAX), Japan (Nikkei 225), Hong Kong (HSI),
Australia (All Ordinaries), Malaysia (KLSE Composite), Singapore (STI)
7.9 5.9 4.5
-8.6
2.7 1.6 1.3
-0.8
10.9
-6.2
2.75.3
1.3 1.6
8.47.9
USA UK Germany J apan Hong Kong Australia Malaysia Singapore
USA UK Germany J apan Hong Kong Australia Malaysia Singapore
%
% Change (Local) % Change (HKD)
Currencies
Bonds *
Equities **
* Bonds: Salomon Smith Barney World Government Bond Indices** Equities: USA (S&P 500), UK (FTSE-100), Germany (DAX), Japan (Nikkei 225), Hong Kong (HSI),
Australia (All Ordinaries), Malaysia (KLSE Composite), Singapore (STI)
German economy a concern (weak IFO 87.4/ Unemployment 10.3%) Rest of Euroland better with France leading the way ECB fiscal policy restriction (Germany & France - exceed the 3% limit) Expect Euroland to lag US in global cycle
UK Government spending remains strong and expect to continue Unemployment remains stable compared to US/Europe Insurance sector - relaxing solvency ratio by regulators
Outlook Underweight in Europe, overweight in UK GDP forecast for 2003 (Europe 1.2%, UK 2.5%)
Hong Kong Outlook for the domestic economy remains subdued
( i.e. unemployment, deflation and property sector) Concern on government budget deficit Exports expected to slow down Market range bound - lack of upside catalyst
Korea Economic growth driven by strong consumer spending and exports Liquidity and low unemployment rates (2.8%) remain supportive Concerns - North Korea’s nuclear issue, slowing consumption
Taiwan Performance of the US market (NASDAQ) important Politics - an area of focus (2004 presidential election) Short-term focus - non-technology stocks Remain underweight - looking to the US market for direction
In the US, we expect the anticipated war with Iraq to be relatively short-lived, and the Fed will have to take back the 50 bps rate cut of last November within 12 months.
In Europe, we anticipate the ECB to sanction an additional easing of 50 bps within the next 3 months, with no further changes forecast over 12 months.
The document is confidential and is supplied to you solely for your information. This document should not be distributed, must not be reproduced or further distributed to any person or entities, whether in whole or in part, for any purpose. This document can only be given to people to whom the relevant HSBC entity are not prohibited by law to provide discretionary investment service under their respective licences issued by the regulators. This document is not and should not be construed as an offer to sell or solicitation of an offer to purchase or subscribe for any investment. HSBC Asset Management (Hong Kong) Limited has based this document on information obtained from sources it believes to be reliable but which it has not independently verified. HSBC Asset Management (Hong Kong) Limited and the HSBC Group make no guarantees, representations or warranties and accept no responsibility or liability as to its accuracy or completeness. Expressions of opinion herein are subject to change without notice.
Cash (3-month HKD Deposit Rate)Global Bonds (Salomon Smith Barney World Government Bond Index)Global Equities (MSCI World Index)Hong Kong Equities (Hang Seng Index)
-40
-30
-20
-10
0
10
20
30
40
12/88 12/90 12/92 12/94 12/96 12/98 12/00 12/02
Mon
thly
retu
rn %
*
Cash (3-month HKD Deposit Rate)Global Bonds (Salomon Smith Barney World Government Bond Index)Global Equities (MSCI World Index)Hong Kong Equities (Hang Seng Index)
* Calculated in HK$ termsSource: Thomson Financial Datastream
Hong Kong CPI inflationCash (3-month HKD Deposit Rate)Global Bonds (Salomon Smith Barney World Government Bond Index)Global Equities (MSCI World Index)Hong Kong Equities (Hang Seng Index)
Examination of investment markets – cumulative return 1989-2002