Is it time to enter the US markets?

Bank of Singapore chief investment officer Karim Al-Aita said the Chinese central bank’s cut in the interest rate on five-year mortgages from 4.6% to 4.45% is a important but insufficient step.

Karim Al-Aita added in an interview with Al-Arabiya today Sunday that the step helps in terms of real estate demand in China, but there is still a need for help on the liquidity side, especially with regard to weaker developer debts in China and an acceleration of mergers in the sector.

He explained that China is trying to implement 3 hard-to-achieve economic goals simultaneously, namely a 5.5% growth rate this year, achieving zero Covid cases and reducing corporate debt, including real estate, explaining that ‘it can achieve a growth rate of 5.5% among these objectives.

Al-Aita said Chinese stocks and some bonds will have good long-term investment opportunities, given China’s consumption and GDP per person in China of around $10,000, which is lower than the America and Europe, and countries such as the United Arab Emirates, which has $60,000. China is currently focusing on clean energy, 5G and other sectors.

He added that tech stocks are historically cheap and you have to see the more conducive climate and regulatory environment for them in China, and anyone with the long breath to own them has a good entry point.

Regarding the bottom in US equities, Karim Al-Aita said that it is not time to see the bottom of the market at present, expecting a technical rebound in the markets within two or three weeks, but the market remains weak in the medium term.

He added that investors should reduce investment debt and get into strong company names, especially tech company names that have fallen a lot in recent times, and get into strong long-term names. , explaining that the energy sector is good and despite its increase compared to other sectors in the last period, but it has not increased in proportion to the recent increases in energy and gas.

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