The Covid-19 remained in the headlines as reported cases continued to rise. The severity of the outbreak had led the WHO  to declare it a pandemic last week.  To date, there are been more than 150,000 reported infections, with over 5,800 fatalities as governments globally race to contain the spread. The tumble in oil prices put additional pressure on global equity markets as a wagging oil war between Russia and the Middle East sent oil prices into the ground.

 

In the news
  • Covid-19 continues to cast a dark shadow over global economies as the outbreak spreads, with rising concerns that the outbreak will be prolonged due to the slow response from some countries.
  • Following the rapid rise in number of reported cases, Germany, France, Italy, Spain, Greece, Belgium, and Austria have since imposed containment measures, including travel bans, gathering restrictions, and closure of schools, universities, restaurants, and bars. 
  • After being on lock-down for most of February, China is now seeing a sharp decline in its number of reported cases. The improved situation has also led to China’s major cities seeing a re-start in its economy as construction, and logistics industry move back on track.
  • The US equity market’s circuit breaker, which halts trading after the market falls more than 7%, was triggered twice last week; first on Monday, and again on Thursday which led to the US equity market to move into bear territory.
  • Global financial markets followed suit, and dove lower last week leaving a sea of red on the trading board.
  • US’ President Trump announced a state of emergency on Friday, allowing access to US 50 billion in federal resources to address the virus outbreak. Markets remain sceptical as little is known on how the US plans to contain the spread of the pandemic.
  • Nevertheless, the US equity markets spiked towards the end of its session but was not enough to lift the market’s weekly performance.
  • Oil price also slid lower last week as the wagging oil war continued. With no clear indication that Russia is willing to go back to the negotiating table with OPEC, coupled with the slower global growth environment, analysts are expecting oil price to remain lower in the near-term.
  • Following the downtrend, Gold price also tumbled lower in a week that saw billions being wiped out of markets.

 

In other economic news
  • Global central banks continued to announce stimulus packages in the wake of the virus outbreak.
    • The US Federal Reserve slashed its interest rates to 0% over the weekend, in a bid to support its economy.
    • The Bank of England (BoE) announced a 50bps rate cut, along with GBP 30 billion stimulus.
    • Germany announced it will add an additional Eur 12.4 billion in infrastructure spending over the course of the next 3-years.
    • Italy, which is now on lock-down following the rapid rise in number of cases, announced that it would inject Eur 10 billion into its economy.
  • China released weaker economic numbers for the period of January to February 2020, acknowledging the toll that the virus outbreak has taken on its economy.
    • Industrial output fell 13.5% YoY between the month of January to February 2020.
    • Retail sales shrank 20.5%, missing the analysts forecast of a 0.8% growth.  The reading also deteriorated from the December growth rate of 8%.
    • While China is getting back on its feet, officials have warned that it would take a longer time before the economy is completely back on track.

 

What to look out for ahead?
  • After a series of rate cuts across the global, we will be keeping an eye on the BoJ as its policy committee will be meeting on the 18th.
    • Markets are expecting the BoJ to step up its ETF purchases at a quicker pace to support its stock market.
  • The development of the pandemic will remain a headline grabber as more countries are anticipated to impose restrictions to contain the spread.
  • We also expect more stimulus plans to be released by the global central banks as pressures continue to mount for the global financial markets.

 

ETF strategies at TradePlus
  • To Hedge
    • 0828EA – a Gold-backed ETF widely used as a storage of value in times of market uncertainty.
    • 0833EA – a HSCEI Inverse strategy that helps hedge your portfolio against weakness from the performance of China companies listed on the HKex.
    • 0831EA – the NYSE FANG+ Inverse strategy that hedges against the performance of tech stocks listed in the US.
  •  To Add Position
    • 0829EA / 0829EB – a strategy that gives investors exposure into the consumer focused sector through China companies listed in HK, and the US
    • 0832EA – a 2X leveraged strategy on the HSCEI that captures 2 times the performance of China companies listed on the HKex
    • 0830EA – a 2X leveraged strategy on the NYSE FANG+ that captures 2 times the performance of US listed tech stocks.

 

A look at the performance of the TradePlus ETFs, and major global indices

 

Learn more about TradePlus ETFs
www.tradeplus.com.my
www.facebook.com/AHAMCapital/
#ahamcapital
+(60) 12 606 8685

 


Disclaimer: This article has been prepared by AHAM Asset Management Berhad (“AHAM Capital”) specific for its use, a specific target audience, and for discussion purposes only. All information contained within this presentation belongs to AHAM Capital and may not be copied, distributed or otherwise disseminated in whole or in part without written consent of AHAM Capital. The information contained in this presentation may include, but is not limited to opinions, analysis, forecasts, projections and expectations (collectively referred to as “Opinions”). Such information has been obtained from various sources including those in the public domain, are merely expressions of belief. Although this presentation has been prepared on the basis of information and/or Opinions that are believed to be correct at the time the presentation was prepared, AHAM Capital makes no expressed or implied warranty as to the accuracy and completeness of any such information and/or Opinions. As with any forms of financial products, the financial product mentioned herein (if any) carries with it various risks. Although attempts have been made to disclose all possible risks involved, the financial product may still be subject to inherent risk that may arise beyond our reasonable contemplation. The financial product may be wholly unsuited for you, if you are adverse to the risk arising out of and/or in connection with the financial product. AHAM Capital is not acting as an advisor or agent to any person to whom this presentation is directed. Such persons must make their own independent assessments of the contents of this presentation, should not treat such content as advice relating to legal, accounting, taxation or investment matters and should consult their own advisers. AHAM Capital and its affiliates may act as a principal and agent in any transaction contemplated by this presentation, or any other transaction connected with any such transaction, and may as a result earn brokerage, commission or other income. Nothing in this presentation is intended to be, or should be construed as an offer to buy or sell, or invitation to subscribe for, any securities. Neither AHAM Capital nor any of its directors, employees or representatives are to have any liability (including liability to any person by reason of negligence or negligent misstatement) from any statement, opinion, information or matter (expressed or implied) arising out of, contained in or derived from or any omission from this presentation, except liability under statute that cannot be excluded.

Warning Statement: A Prospectus is available for the TradePlus Shariah Gold Tracker and TradePlus S&P New China Tracker, while a Master Prospectus is available for the TradePlus NYSE® FANG+TM Daily (2x) Leveraged Tracker, TradePlus NYSE® FANG+TM Daily (-1x) Inverse Tracker, TradePlus HSCEI Daily (2x) Leveraged Tracker and TradePlus HSCEI Daily (-1x) Inverse Tracker (collectively known as the “TradePlus L&I ETFs”), and investors have the right to request a copy of it. Investors are advised to read and understand the contents of the Prospectus dated 28 November 2017 and Supplementary Prospectus dated 2 July 2019 (for TradePlus Shariah Gold Tracker), and Prospectus dated 15 January 2019 and Supplementary Prospectus dated 2 July 2019 (for TradePlus S&P New China Tracker), as well as the Master Prospectus dated 26 November 2019 (for the TradePlus L&I ETFs) before investing. The Prospectus / Supplementary Prospectus / Master Prospectus have been registered with the Securities Commission Malaysia, who takes no responsibility for its contents. An electronic copy of the Prospectus / Supplementary Prospectus / Master Prospectus can be obtained at Affin Hwang Asset Management Berhad’s website www.tradeplus.com.my. As with any forms of financial products, the financial products mentioned herein carries with them various risks. Investors are advised to consider the general and specific risks involved as stipulated in its Prospectus / Supplementary Prospectus / Master Prospectus before investing. There are also fees and charges involved when investing in these funds, and investors are advised to consider the fees and charges carefully before investing. The price of units and distribution payable, if any, may go down as well as up and past performance of the funds should not be taken as indicative of their future performance. 

Licensing Disclosure Statement & Conditions: The "S&P New China Ex A-Shares Index" is a product of S&P Dow Jones Indices LLC, a division of S&P Global, or its affiliates (“SPDJI”) and has been licensed for use by Affin Hwang Asset Management Bhd. Standard & Poor’s® and S&P® are registered trademarks of Standard & Poor’s Financial Services LLC, a division of S&P Global (“S&P”); Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”) and these trademarks have been licensed for use by SPDJI and sublicensed for certain purposes by Affin Hwang Asset Management Bhd. TradePlus S&P New China Tracker is not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P, their respective affiliates and none of such parties make any representation regarding the advisability of investing in such product(s) nor do they have any liability for any errors, omissions, or interruptions of the S&P New China Ex A-Shares Index.

Licensing Disclosure Statement & Conditions: Source ICE Data Indices, LLC (“ICE Data”), is used with permission. “NYSE® FANG+™” is a service/trade mark of ICE Data Indices, LLC or its affiliates and has been licensed, along with the NYSE® FANG+™ Daily 2X Leveraged Index and NYSE® FANG+™ Daily 1x Inverse Index (“Indices”) for use by Affin Hwang Asset Management Berhad in connection with the TradePlus NYSE® FANG+™ Daily (2x) Leveraged Tracker and the TradePlus NYSE® FANG+™ Daily (-1x) Inverse Tracker (the “Product”). Neither Affin Hwang Asset Management Berhad nor the Product, as applicable, is sponsored, endorsed, sold or promoted by ICE Data Indices, LLC, its affiliates or its Third Party Suppliers (“ICE Data and its Suppliers”). ICE Data and its Suppliers make no representations or warranties regarding the advisability of investing in securities generally, in the Product particularly, or the ability of the Index to track general stock market performance. ICE Data’s only relationship to Affin Hwang Asset Management Berhad (“Licensee”) is the licensing of certain trademarks and trade names and the Index or components thereof. The Index is determined, composed and calculated by ICE Data without regard to the Licensee or the Product or its holders. ICE Data has no obligation to take the needs of the Licensee or the holder of the Product into consideration in determining, composing or calculating the Index. ICE Data is not responsible for and has not participated in the determination of the timing of, prices of, or quantities of the Product to be issued or in the determination or calculation of the equation by which the Product is to be priced, sold, purchased, or redeemed. Except for certain custom index calculation services, all information provided by ICE Data is general in nature and not tailored to the needs of Licensee or any other person, entity or group of persons. ICE Data has no obligation or liability in connection with the administration, marketing, or trading of the Product. ICE Data is not an investment advisor. Inclusion of a security within an index is not a recommendation by ICE Data to buy, sell, or hold such security, nor is it considered to be investment advice. 

ICE DATA AND ITS SUPPLIERS DISCLAIM ANY AND ALL WARRANTIES AND REPRESENTATIONS, EXPRESS AND/OR IMPLIED, INCLUDING ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE, INCLUDING THE INDICES, INDEX DATA AND ANY INFORMATION INCLUDED IN, RELATED TO, OR DERIVED THEREFROM (“INDEX DATA”). ICE DATA AND ITS SUPPLIERS SHALL NOT BE SUBJECT TO ANY DAMAGES OR LIABILITY WITH RESPECT TO THE ADEQUACY, ACCURACY, TIMELINESS OR COMPLETENESS OF THE INDICES AND THE INDEX DATA, WHICH ARE PROVIDED ON AN “AS IS” BASIS AND YOUR USE IS AT YOUR OWN RISK.