2025-06-10-Jefferies-亚太量化_美元疲软的影响_36页_1mb

Summary of APAC Quant: Weak Dollar Implications

Core Content

The document discusses the implications of a weak US dollar (DXY) on Asian and Emerging Market (EM) equities, highlighting that a weaker dollar is generally beneficial for the region. The DXY index has fallen by approximately 10% this year, and despite the Federal Reserve delaying rate cuts, the trend of a weak dollar is expected to continue. This has led to positive returns for Asian markets, with MSCI APxJ up by about 10% year-to-date (YTD), and the impact on earnings is minimal compared to other macroeconomic factors.

Main Viewpoints

• Weak Dollar Benefits Asia: A falling DXY has been a significant contributor to Asian returns and earnings revisions. MSCI APxJ has historically outperformed by about 6% when DXY drops by more than 4%, while it has dropped by about 3% when DXY rises by more than 4%.
• Country Performance: Korea, Australia, and China are expected to outperform during a weak dollar period, while Japan, Malaysia, Indonesia, and India are more positively correlated with DXY and may underperform.
• Sector Impact: Sectors like materials, discretionary retail, cap goods, and media tend to outperform during dollar weakness, whereas telecom, utilities, HPC, and pharma are likely to underperform.
• Earnings Revisions: The multivariate regression analysis shows that DXY is a significant factor for China, Australia, and Indonesia. For every 10% depreciation in DXY, China's earnings revisions are expected to rise by about 3ppt, while Australia and Indonesia may see 2-4ppt downgrades.
• US Exporters Underperform: US exporters are lagging behind non-US exporters and domestic stocks, with domestic-focused markets like China and Korea showing stronger performance.

Key Information

• Country Rankings:

  • Overweight (OWT): Korea, China, Hong Kong
  • Neutral: India, Singapore, Australia, Malaysia
  • Underweight (UWT): Philippines, Thailand, Indonesia, Taiwan

• Sector Preferences:

  • Overweight (OWT): Communication services, Discretionary, Industrials
  • Neutral: Property, Infotech, Healthcare, Staples
  • Underweight (UWT): Utilities, Energy, Industrials, Materials

• Key Stocks:

  • Compounders:
    • 1211 HK (BYD H), 1810 HK (Xiaomi B), 207940 KS (SAMSUNG BIOLOGICS), BHE IN (Bharat Electronics), 3606 HK (Fuyao Glass Industry Grp H), 605499 CH (Eastroc Beverage A), 064350 KS (Hyundai Rotem), TNE AU (Technology One), 079550 KS (LIG Nex1), 2059 TT (King Slide Works)
  • Companies with Positive Earnings Momentum:
    • BHARTI IN (Bharti Airtel), 000660 KS (SK hynix), 1299 HK (AIA Group), 600276 CH (Jiangsu Hengrui Pharma), TLS AU (Telstra Group), INDIGO IN (InterGlobe Aviation), 015760 KS (KEPCO), 2269 HK (Wuxi Biologics), 293 HK (Cathay Pacific Airways), 2383 TT (Elite Material)

• Valuation and Growth:

  • MSCI APxJ is trading at a lower forward PE compared to the S&P 500 and is seen as more attractive.
  • Earnings growth for MSCI AsiaxJ is expected to be around 7.1% and 7.5% for 2025-2026, which is lower than the consensus of 10.8% and 12.4%.
  • The China Terrific 10 has significantly outperformed the S&P 500 and has lower valuations and better earnings revisions.

• Risk Factors:

  • The main risks include potential Trump actions on tariffs leading to a recession and geopolitical tensions affecting the US economy.
  • A sharp tariff-induced global growth slowdown and high US inflation are also risks.

• Market Outlook:

  • The document emphasizes a growth-focused portfolio, with value stocks performing well in China and Korea.
  • Asian markets are expected to continue outperforming the US, especially with a weak dollar and favorable valuations.

Conclusion

The weak US dollar is expected to continue supporting Asian equities and earnings. Korea, China, and Hong Kong are highlighted as the most attractive markets, while US exporters are underperforming. The analysis suggests that a growth strategy remains favorable, with a focus on sectors like communication services, discretionary, and industrials. The document also provides a list of key stocks and sector rankings based on macroeconomic factors.