Chinese Economy & Stock Market Recovery on Track (Chinese)

Date: July 7, 2022

Event: Quarterly Update on China by MegaTrust Investments

Location: Shanghai, China

Language: Chinese

Speakers: Charlie Chen CFA, Founder and CIO (left)

Xixi Peng CFA, Head of Markets and Investor Services (right)

Key Takeaways

• Major surprises in the first half: (1) Longer-than-expected lockdowns in cities like Shanghai, and (2) Bigger-than-expected corrections in certain sectors like new energy and healthcare (pharmaceuticals)

• No. 1 risk in the second half: covid-related uncertainty, especially in domestic consumption (not just in Shanghai but also countrywide)

• No. 2 risk: external shocks from a potential U.S. / global recession

• No. 3 risk: earning risk from a combination of factors, such as higher cost of production, transportation and logistics challenges, and weakening demand.