China’s CEWC confirms pro-growth and pro-business policy

Last Friday’s Central Economic Work Conference (CEWC) confirmed the message from the 7 Dec Politburo meeting which was: growth would be the top priority for next year and the key is to boost business confidence.

???????The market will now be expecting 1) a higher Chinese GDP growth target that is larger than 5% in March 2023; 20 a policy environment for private companies to turn more friendly in 2023 that it ever was in the last 5 years, and 3) for earnings from Chinese companies to improve meaningfully from the second quarter of next year.

 
Investors who believe that the Hong Kong indices and Chinese stocks will continue its upward momentum toward the 20,000 level in the short-term on the back of pro-growth and pro comments by the China government can consider buying call warrants over HSI, HSTECH and/or Chinese stocks, while those who believe the market may hit a short-term resistance and pull back can consider put warrants over these indices…