Weekly Market View The COMO factor - Standard Chartered
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Wealth Management Chief Investment Office
11 March 2022
Weekly Market View
The COMO
factor
This week’s volatile market moves
convey two important lessons: First,
although risk assets continued to tread
water, the sharp rebound in stocks on
Wednesday, led by nearly 9% surge in
Euro area equities, and the plunge in oil
prices suggest much of the downside
scenario from the Ukraine conflict has
already been priced into markets.
The second lesson is more of a
reminder that investors face a significant
Cost of Missing Out (the “COMO factor”)
on some of the best days in the market if
they stay out of it.
Taken together, the lessons reinforce
our call to stay invested through a
diversified portfolio based on individual What are your thoughts on
risk tolerance, even though geopolitics China stocks after the selloff?
clouds the outlook in the near term. In this
report, we lay out some of the defensive
strategies that continue to offer a good
What measures can Chinese
hedge against the uncertainty, while
authorities take to stabilise the
positioning for medium-term opportunities.
real estate sector?
Why has JPY not benefitted
from geopolitical risk aversion?
Important disclosures can be found in the Disclosures Appendix.Standard Chartered Bank
Wealth Management Chief Investment Office | 11 March 2022
Charts of the week: Cost of missing out (COMO) on the best days
Staying invested through a downturn tends to generate the best returns as we get to participate in the biggest rebounds
S&P500 returns – total and after leaving out the best ‘up’ days* Performance of S&P500 index through past geopolitical crises
130 127.8
2,000%
(100 = event date)
117.6
S&P500 index
113.5
1,500% 113.5
105
110.2
108.6
1,000%
80
-25 5 35 65 95 125 155 185 215 245 275 305 335 365
500% Days before/after event date
1967 Arab-Israeli war (War lasting 6 days)
1962 Cuban missile crisis (1 month 4 days)
0% 2014 Russia invades Crimea (1 month 6 days)
1990 Iraq's invasion of Kuwait (6 months)
Stay invested Miss 5 best trading Miss 30 best 1968 Vietnam war (10 months)
days trading days 1950 North Korean invasion of South Korea (3 years)
Source: CFRA, Bloomberg, Standard Chartered; *Example of S&P500 index returns from 1 January 1988 to 31 December 2021, compared with the
returns after taking out the five best days and 30 best days of the index
Editorial
The COMO factor prices and boost defence spending would be a major step
This week’s volatile market moves convey two important forward for EU fiscal policy. A more aggressive fiscal policy
lessons: First, although risk assets continued to tread water due would help counterbalance the ECB’s hawkish move this week
to the impact of the Ukraine conflict, the sharp rebound in to stick with its plan to end its bond buying programme this year.
stocks on Wednesday, led by c.9% surge in Euro area equities, The ECB surprise decision shows western central banks are
and the plunge in oil prices indicate how much of the downside still focused on battling inflation. This is likely to be reinforced
scenario has already been priced into markets. Wednesday’s in the coming week in the US, where a surge in inflation to four-
rebound was triggered merely by comments from Ukrainian decade highs boxes the Fed into a corner as it likely embarks
officials that they are willing to talk to Russia about staying on its rate hiking cycle. US long-term inflation expectations
neutral regarding NATO membership. The second lesson is have broken higher with oil prices. This increases pressure on
more of a reminder that investors face a significant Cost of the Fed to fight inflation, even as the continued flattening of the
Missing Out (the “COMO factor”) on some of the best days in US Treasury yield curve suggests investors are increasingly
the market if they stay out of it (see chart). Taken together, the worried about the medium-term growth outlook. We will watch
lessons reinforce our call to remain invested through a the Fed’s new growth, inflation and interest rates projections to
diversified portfolio, even though geopolitics clouds the outlook. judge whether policymakers see stagflation risks building. We
The Ukraine conflict is by no means over. Several rounds of believe the US is less prone to stagflation compared with
talks between Ukraine and Russia have ended inconclusively. Europe, given the US’ robust underlying growth and job market
While we continue to watch whether the second of our “three fundamentals and lower dependence on oil and gas imports.
red lines” discussed last week (i.e. a significant drop in energy Against a challenging backdrop in the West, Chinese assets
and other commodity flows from Russia) comes to pass, recent offer good hedge against the Ukraine uncertainty, in our view.
comments from European policymakers suggest a ban on EU This includes defensive assets such as Chinese government
imports of Russian energy is unlikely anytime soon, given the bonds and CNY as well as risk-oriented China equities and
lack of ready alternatives. There is, of course, the risk of Russia USD-denominated corporate bonds. China’s National People’s
cutting off gas supplies, but we believe such a move would be Congress this week set a higher-than-expected 5.5% growth
counter-productive because these supplies are now Russia’s target for 2022. This is a clear sign that policymakers are
main source of revenue following severe western sanctions. turning growth supportive. As if on cue, China’s credit growth
On the positive side, we see the contours of a concerted policy has started to pick up and property measures have been eased
action forming in Europe which could help the region counter significantly across more than 50 cities. We see significant
growing stagflation risks. For one, EU officials are meeting this scope of fiscal spending from Beijing, given spill overs from last
week to discuss how to support the region’s economies most year’s budget. Additionally, Gold and energy assets have also
impacted by the conflict in Ukraine. Any agreement to mutually delivered during the recent market volatility and remain good
share the debt burden of EU members with an aim to protect hedges if the Ukraine conflict is prolonged.
the region’s companies and consumers from rising oil and gas — Rajat Bhattacharya
Important disclosures can be found in the Disclosures Appendix. 2Standard Chartered Bank
Wealth Management Chief Investment Office | 11 March 2022
The weekly macro balance sheet
Our weekly net assessment: On balance, we see the past week’s data Our Fear and Greed index is now deeply in ‘Fear’
and policy as neutral for risk assets in the near term territory, which is usually a contrarian signal for
(+) factors: Strong US labour market, supportive China policies market reversals
(-) factors: Ukraine crisis continues, rising US inflation, hawkish ECB Our proprietary ‘Fear and Greed’ index
90 Extreme greed
Positive for risk assets Negative for risk assets
Fear and greed index
75 Greed
• Germany to lift most • China, New Zealand and
60
restrictions by 20 March South Korea reported
record daily cases 45
• HK dropped mass testing
COVID-19
as priority; focus now on • US raised travel advisory 30
Fear 36.1
controlling deaths warning for HK 15 Extreme
fear
Our assessment: Neutral – Continued reopening of borders, 0
Dec-04 Sep-10 Jun-16 Mar-22
change in HK COVID strategy vs record cases in parts of Asia
Source: Bloomberg; Standard Chartered
• US added more jobs than • US consumer inflation
expected in February accelerated to a 40-year
• China consumer inflation in high of 7.9%; jobless claims
US medium-to-long-term inflation expectations
Macro data
line with expectations at unexpectedly rose have broken higher with oil prices, increasing
0.9% • China producer inflation pressure on the Fed to tighten policy
rose more than expected US 2-, 5- and 10-year inflation expectations derived
from Treasury inflation-protected bonds
Our assessment: Neutral – Strong US job creation, low China
150 113.2 6.0
inflation vs rising US inflation
4.4
100 3.4 4.0
• China set higher-than- • ECB surprised markets by
USD/bbl
2.9
%
expected 5.5% growth maintaining its plan to end 50 2.0
developments
target for 2022 bond purchases this year 0 0.0
Policy
• PBoC to hand over profits as it prioritises fighting
-50 -2.0
to boost fiscal spending inflation Jan-12 Jun-15 Nov-18 Apr-22
WTI US breakeven 2y (RHS)
Our assessment: Neutral – China likely to boost policy to
US breakeven 5y (RHS) US breakeven 10y (RHS)
meet 2022 growth target vs ECB stays hawkish to curb inflation
Source: Bloomberg, Standard Chartered
• Russia and Ukraine met for • Russia’s Putin reiterated
third and fourth rounds of that the war would continue
talks but reported limited until Ukraine accepts his The ECB cut its growth forecasts and lifted
progress demands inflation forecasts for 2022 and 2023
• A top official said Ukraine • Moscow threatened to cut The ECB’s new growth and inflation estimates
ready for talks with Russia gas supplies to Europe 6
developments
on maintaining Ukraine’s • US to ban imports of 5
neutral status related to Russian oil, gas & energy 4
Other
NATO 3
• South Korea elected Yoon 2
ECB Target
• China is reportedly Suk-yeol, a conservative 1
considering buying or candidate, as President 0
raising stakes in Russian GDP GDP GDP Inflation Inflation Inflation
• North Korea conducted 2022 2023 2024 2022 2023 2024
energy and commodity
another reconnaissance Prior Latest
firms
satellite test
Source: Bloomberg, Standard Chartered
Our assessment: Negative – Ukraine conflict continues
Important disclosures can be found in the Disclosures Appendix. 3Standard Chartered Bank
Wealth Management Chief Investment Office | 11 March 2022
Top client questions
What are your thoughts on China stocks after the sell-off? The MSCI China index’s decline since 2021 peak is
already larger than previous major pullbacks of
China equities are approaching key technical support levels, with the past decade, making it overdue for a rebound
MSCI China 5% above the key support of 67. MSCI China has fallen
MSCI China index (since March 2014)
by 45% since its peak in 2021. This drop is already larger than other
130
significant pullbacks, such as its 32% drop in 2018 amid trade war
fears and the 43% fall in 2015 post the clamp-down on A-Shares’ 115
margin financing. These factors lead us to believe the MSCI China 100
MSCI China
index is overdue for a technical rebound in the near term.
85
Over a longer 12-month horizon, we view Chinese equities as 70
preferred within Asia ex-Japan, which in turn is a preferred region -32% -45%
55 70.9
globally. We see increasing evidence that China is likely to ease both -43%
fiscal and monetary policies further in order to achieve its ambitious 40
Mar-14 Nov-16 Jul-19 Mar-22
5.5% GDP growth target. This is in stark contrast to the US, where
policies are tightening. China’s credit impulse has also likely Source: MSCI, Bloomberg, Standard Chartered
bottomed out. We believe the impact of the past regulatory tightening
is most likely priced in. Risks include potential escalation of tension
China’s consumer inflation remains subdued,
with the West over Chinese companies’ dealings with Russia, and while producer inflation has peaked, enabling
also delisting concerns of Chinese ADRs from the US. authorities to ease policy to support growth
— Daniel Lam, CFA, Senior Cross-asset Strategist China’s consumer and producer price inflation
14 8.0
11 6.0
What measures can Chinese authorities take to stabilise
the real estate sector? 8 8.8
y/y (%)
4.0
y/y (%)
5
Chinese real estate sector bonds dipped further over the past week 0.9 2.0
2
over concerns surrounding a couple of mid-sized private developers.
-1 0.0
Since the start of the year, the Chinese High Yield Real Estate bond
index has declined c.38% and now stands c.60% lower than levels -4 -2.0
Jan-18 Jun-19 Nov-20 Apr-22
seen in May 2021 in terms of total returns, making this an
unprecedented sell-off. China PPI China CPI (RHS)
Source: MSCI, Bloomberg, Standard Chartered
While the authorities have taken a number of steps to ease the strain
in the property sector, including (i) easing sector restrictions in over
50 cities, (ii) reducing down-payment requirements, and (iii) relaxing China’s HY real estate bonds have plunged close
mortgage rates, they have clearly fallen short of restoring market to 60% since May 2021 amid concerns about rising
confidence. The sharp decline in property sales YTD adds to the defaults; we believe the decline is overdone
cash flow challenges for developers, especially since asset China high yield real estate bond price index
disposals have proceeded at a slower pace than anticipated. With
100
significant maturities due through March and April, the upcoming
months could be volatile. 80
However, the ambitious economic growth target set by Chinese
Index
60
authorities may offer further support to the property sector. In
particular, we would watch out for measures to improve developer
40
liquidity by giving them greater access to funds from pre-sales,
easier lending standards from onshore financial institutions and 32.2
20
faster asset takeovers/M&As by state-owned enterprises (SOEs). Jan-18 Jun-19 Nov-20 Apr-22
Given the fragile sentiment and low bond prices, we continue to China High Yield Real Estate Bond Price index
believe that the risk-reward remains skewed to the upside over a 6- Source: Bloomberg, Standard Chartered
12-month horizon, even if the short-term path remains volatile.
— Abhilash Narayan, Senior Investment Strategist
Important disclosures can be found in the Disclosures Appendix. 4Standard Chartered Bank
Wealth Management Chief Investment Office | 11 March 2022
Top client questions (cont’d)
Why has JPY not benefitted from geopolitical risk The JPY has been a mild safe haven during the
aversion? Ukraine conflict, as investors hedge commodity
supply rather than financial market fears; short
Japan is the world’s largest creditor nation, supporting its currency’s JPY positioning and sentiment are near extremes
safe-haven role, but it has not behaved as expected since the start
USD/JPY spot with technical levels
of the Russian invasion of Ukraine. We believe there are three
120.00 118.00 114.82
reasons for this. First, the main driver of USD/JPY has been 2-year
government bond yield differentials and market expectations for Fed 115.00 116.35 113.50
USD/JPY
policy normalisation have not been downgraded sufficiently for the
112.50
differentials to narrow. Second, investors have identified 110.00
109.34
commodities as a strong hedge for this specific geopolitical risk, and 105.00
as a result, commodity currencies, such as the AUD and NZD, have
become alternative safe havens. Finally, Japan is a significant 100.00
Jun-16 May-18 Apr-20 Mar-22
energy importer and, hence, its own terms of trade have declined.
USD/JPY 200dma S1
These opposing drivers may continue in the near term, but we see S2 R1 R2
limited upside for USD/JPY. We expect inflationary pressure to rise
Source: Bloomberg, Standard Chartered
as the new Japanese financial year starts in April, and there are
emerging signs that the BoJ’s current monetary policy may be
challenged. The JPY is cheap on several valuation models, and we CHF/SGD is nearing technical resistance; We
suspect short-term reversals remain possible. We expect strong expect the SNB to continue pushing against CHF
strength, offering a loan switch opportunity
technical resistance from 116.35 to 117.25, and above 118. On the
downside, there is trendline support around 114.50 and 113.50 and CHF/SGD spot with technical levels
critical medium-term support at 112.50. Our outlook is for a 1.5200 1.5130 1.4841
rangebound USD/JPY with a bearish bias. 1.4800 1.4970
1.4450
CHF/SGD
1.4400 1.4200
1.4000 1.4294
What is your view on USD/SGD, both directionally and 1.3600
from a funding currency perspective? 1.3200
Jan-19 Feb-20 Mar-21 Apr-22
We expect improved economic performance across Asia in 2022 as
CHF/SGD 200dma S1
COVID-19’s impact finally subsides and travel and tourism rebound.
S2 R1 R2
We also believe that China is embarking on stimulating its economy
more aggressively to attain its 5.5% growth target. Finally, we expect Source: Bloomberg, Standard Chartered
the USD to peak soon. USD/SGD has traded between 1.3350 and
1.3750 since mid-2021. Our bias is to fade rallies in favour of a lower Asian economic performance is likely to improve,
USD/SGD by the end of 2022. We expect strong resistance at supported by China growth; We expect the USD to
1.3750–1.3800 in the near term, followed by 1.3900. A break below peak, and this should prompt a lower USD/SGD
1.3500 could see an acceleration to test 1.3380 and below. USD/SGD spot with technical levels
The SGD is also a key tool for Singapore’s monetary policy. Given
1.4000 1.3900
rising inflation concerns, we do not expect the currency to trade
1.3800 1.3750 1.3597
much weaker, irrespective of the USD trend. Therefore, we do not
USD/SGD
see the SGD as an appealing funding currency going forward. We 1.3600
prefer to consider the CHF, a very low-interest rate currency that is 1.3400
1.3400 1.3520
considered overvalued, where positioning is overbought, and the 1.3200 1.3150
central bank has a weaker currency on its policy agenda. CHF/SGD 1.3000
has traded between 1.4450 and 1.4970 since April 2021, despite the Jan-21 Aug-21 Mar-22
CHF being a robust safe haven since the Ukraine conflict began. We USD/SGD 200dma S1
have a bearish bias for CHF/SGD on rallies above 1.48. A break S2 R1 R2
below 1.4450 should trigger a test of key 1.4200 support. Source: Bloomberg, Standard Chartered
Important disclosures can be found in the Disclosures Appendix. 5Standard Chartered Bank
Wealth Management Chief Investment Office | 11 March 2022
Technical charts of the week
Manish Jaradi
Senior Investment Strategist
China equities: History repeats itself? Hong Kong equities: Testing crucial support
MSCI China index monthly chart with 200-MMA Hang Seng index monthly chart with 200-MMA
135 35,000
115 30,000
95 25,000
75 20,000
55 15,000
35 10,000
15 5,000
Jul-03 Oct-09 Jan-16 Apr-22 Jan-96 Oct-04 Jul-13 Apr-22
Source: Refinitiv, Standard Chartered Source: Refinitiv, Standard Chartered
The index is testing key support. The higher-highs-higher- Granted, the index is now below the 200-month moving
lows pattern over the past two decades raises the odds that average, but the fall below does not necessarily imply
this time may not be different – the possibility of a rebound extended weakness. Indeed, it could, but when multiple
remains alive, like it did in 2016. Still, the index would need support levels converge, it is often prudent to wait before
to break above resistance on the 200-DMA (now at 91; 28% jumping to that conclusion. At least, this is what history
from Thursday’s close) for the outlook to turn bullish. suggests – something similar happened in 2008-2009.
Gold: Time for a pause? USD/JPY: Resilient despite elevated risk aversion
XAU/USD weekly chart USD/JPY weekly chart
2,150 120
2,000 117
1,850 114
1,700 111
1,550 108
1,400 105
1,250 102
1,100 99
Mar-18 Jul-19 Nov-20 Mar-22 Jul-16 Jun-18 May-20 Apr-22
Source: Refinitiv, Standard Chartered Source: Refinitiv, Standard Chartered
A potential bearish candle at a major resistance at the 2020 Despite the spike in risk aversion recently, USD/JPY has
high raises the risk of a short-term pause given overbought been surprisingly resilient – it has not broken any meaningful
conditions. In this regard, follow-through price action, i.e., support. On the contrary, it is headed for the first weekly close
continued weakness next week, would confirm that a short- above 116 since 2017. Moreover, if it breaks above 116.35,
term high is in place. This would not imply bearishness, but a given the higher-highs-higher-lows pattern, the probability of
short-term range before the resumption of the uptrend. a rise towards the 2016 high of 118.66 would rise.
Important disclosures can be found in the Disclosures Appendix. 6Standard Chartered Bank
Wealth Management Chief Investment Office | 11 March 2022
Market performance summary *
2022 YTD 1 Week
Equity | Country & Region
Global Equities -10.9% -2.8%
Global High Divi Yield Equities -5.3% -2.9%
Developed Markets (DM) -10.9% -2.4%
Emerging Markets (EM) -10.3% -5.9%
US -11.1% -2.5%
Western Europe (Local) -11.4% -2.0%
Western Europe (USD) -14.1% -2.6%
Japan (Local) -8.9% -2.7%
Japan (USD) -9.5% -3.0%
United Kingdom -4.5% -3.0%
Asia ex-Japan -10.7% -5.0%
Africa 11.3% -2.4%
Eastern Europe -80.8% -62.6%
Latam 14.6% -1.1%
Middle East 13.7% -0.6%
China -16.2% -8.7%
India -7.3% -0.2%
South Korea -12.5% -4.6%
Taiwan -7.2% -3.8%
Equity | Sector
Consumer Discretionary -18.3% -3.8%
Consumer Staples -8.5% -4.2%
Energy 18.5% 0.4%
Financial -6.2% -3.0%
Healthcare -9.2% -1.5%
Industrial -10.1% -1.8%
IT -16.9% -3.9%
Materials -2.8% -2.7%
Communication Services -14.7% -3.2%
Utilities -3.7% 1.3%
Global Property Equity/REITs -7.1% -0.3%
Bonds | Sovereign
DM IG Sovereign -5.2% -1.6%
US Sovereign -3.8% -1.0%
EU Sovereign -6.4% -2.2%
EM Sovereign HC -11.6% -2.0%
EM Sovereign LC -7.0% -1.8%
Asia EM LC -2.8% -1.4%
Bonds | Credit
DM IG Corporates -7.7% -2.2%
DM High Yield Corporates -6.2% -1.5%
US High Yield -5.3% -1.7%
Europe High Yield -8.1% -1.7%
Asia HC -6.4% -1.7%
Diversified Commodity 26.2% 1.8%
Agriculture 22.5% 0.1%
Energy 40.0% -1.7%
Industrial Metal 33.2% 11.7%
Precious Metal 10.1% 3.6%
Crude Oil 42.2% -1.0%
Gold 9.2% 3.2%
FX (against USD)
Asia ex-Japan -0.6% -0.4%
AUD 1.3% 0.4%
EUR -3.4% -0.7%
GBP -3.3% -2.0%
JPY -0.9% -0.6%
SGD -0.8% -0.2%
Alternatives
Composite (All strategies) -2.4% -0.5%
Relative Value -3.6% -0.9%
Event Driven -2.5% -1.1%
Equity Long/Short -2.2% -0.4%
Macro CTAs -0.8% 1.1%
-120% -70% -20% 30% 80% -80.0% -60.0% -40.0% -20.0% 0.0% 20.0%
Sources: MSCI, JP Morgan, Barclays Capital, Citigroup, Dow Jones, HFRX, FTSE, Bloomberg, Standard Chartered
*Performance in USD terms unless otherwise stated, 2022 YTD performance from 31 December 2021 to 10 March 2022; 1-week period: 03 March
2022 to 10 March 2022; Note: Eastern Europe equity index’s sharp decline this week follows a trading halt.
Important disclosures can be found in the Disclosures Appendix. 7Standard Chartered Bank
Wealth Management Chief Investment Office | 11 March 2022
Our 12-month asset class views at a glance Economic and market calendar
Asset class Event Next week Period Expected Prior
▲ ◆
MON
Equities Alternatives
Euro area ◆ Equity hedge ▲
◆ ◆
Property Investment
US Event-driven CH Feb -6.0% 4.4%
YTD y/y
UK ◆ Relative value ▼ CH
Fixed Assets Ex Rural
Feb 5.0% 4.9%
YTD y/y
Asia ex-Japan ▲ Global macro ◆ ILO Unemployment
TUE
UK Jan – 4.1%
Japan ◆ Rate 3Mths
ZEW Survey
Other EM ◆ Cash ◆ EC
Expectations
Mar – 48.6
USD ▼ US PPI Final Demand y/y Feb 10.0% 9.7%
US Empire Manufacturing Mar 8.0 3.1
Bonds (Credit) ▼ EUR ▲
WED
Asia USD ▲ GBP ▲ US
Retail Sales Ex Auto
and Gas
Feb 0.6% 3.8%
Corp DM HY ▲ CNY ▲
FOMC Rate Decision 3/16/
Govt EM USD ◆ JPY ◆ US
(Upper Bound) 2022
0.5% 0.25%
Corp DM IG ▼ AUD ▲ UK
Bank of England Bank 3/17/
0.75% 0.5%
THUR
Rate 2022
NZD ◆ US Housing Starts Feb 1700k 1638k
Bonds (Govt) ▼ CAD ▲ US
Philadelphia Fed
Mar 17 16
Business Outlook
Govt EM Local ◆ US Industrial Production m/m Feb 0.6% 1.4%
Govt DM IG ▼ Gold ▲
SAT
Bank of Japan Policy 3/18/
FRI/
Source: Standard Chartered Global Investment Committee JP – 0.1%
Balance Rate 2022
Legend: ▲ Most preferred | ▼ Less preferred | ◆ Core holding Source: Bloomberg, Standard Chartered
Prior data are for the preceding period unless otherwise indicated. Data
are % change on previous period unless otherwise indicated
P - preliminary data, F - final data, sa - seasonally adjusted, y/y - year-
on-year, m/m - month-on-month
The S&P500 index’s next support is 2% below current level Investor diversity widened in crude oil after steep drop
Technical indicators for key markets as on 10 March 2022 Our proprietary market diversity indicators as of 10 March
1st 1st 1-month Fractal
Index Spot support resistance Level 1 Diversity trend dimension
S&P500 4,260 4,177 4,335 Global Bonds ◐ → 1.26
STOXX 50 3,651 3,516 3,777
Global Equities ◐ → 1.40
Gold ◐ 1.29
FTSE 100 7,099 6,975 7,207 Equity
Nikkei 225 25,690 24,943 26,211 MSCI US ◐ → 1.45
Shanghai Comp 3,296 3,219 3,410 MSCI Europe ◐ → 1.43
MSCI AC AXJ ◐ → 1.32
Hang Seng 20,890 20,377 21,654
Fixed Income
MSCI Asia ex-Japan 704 687 722 DM Corp Bond ◐ 1.27
MSCI EM 1,103 1,081 1,135 DM High Yield ◐ 1.34
EM USD ◐ 1.27
Brent (ICE) 109.3 103.1 121.8
EM Local ◐ 1.36
Gold 1,998 1,962 2,042 Asia USD ◐ 1.27
UST 10Y Yield 1.99 1.82 2.07 Commodities
Source: Bloomberg, Standard Chartered WTI crude oil ◐ 1.30
Note: These short-term technical levels are based on models and may Source: Bloomberg, Standard Chartered; Fractal dimensions below
differ from a more qualitative analysis provided in other pages 1.25 indicate extremely low market diversity/high risk of a reversal
Legend: ● High | ◐ Low to mid | ○ Critically low
Important disclosures can be found in the Disclosures Appendix. 8Standard Chartered Bank
Wealth Management Chief Investment Office | 11 March 2022
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Market Abuse Regulation (MAR) Disclaimer
Banking activities may be carried out internationally by different branches, subsidiaries and affiliates within the Standard Chartered
Group according to local regulatory requirements. Opinions may contain outright “buy”, “sell”, “hold” or other opinions. The time
horizon of this opinion is dependent on prevailing market conditions and there is no planned frequency for updates to the opinion.
This opinion is not independent of Standard Chartered Group’s trading strategies or positions. Standard Chartered Group and/or its
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9Standard Chartered Bank
Wealth Management Chief Investment Office | 11 March 2022
short any securities or financial instruments referred to in this document or have material interest in any such securities or related
investments. Therefore, it is possible, and you should assume, that Standard Chartered Group has a material interest in one or more
of the financial instruments mentioned herein. Please refer to https://www.sc. com/en/banking-services/market-disclaimer.html for
more detailed disclosures, including past opinions/ recommendations in the last 12 months and conflict of interests, as well as
disclaimers. A covering strategist may have a financial interest in the debt or equity securities of this company/issuer. This document
must not be forwarded or otherwise made available to any other person without the express written consent of Standard Chartered
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Country/Market Specific Disclosures
Botswana: This document is being distributed in Botswana by, and is attributable to, Standard Chartered Bank Botswana Limited
which is a financial institution licensed under the Section 6 of the Banking Act CAP 46.04 and is listed in the Botswana Stock
Exchange. Brunei Darussalam: This document is being distributed in Brunei Darussalam by, and is attributable to, Standard
Chartered Bank (Brunei Branch) | Registration Number RFC/61. Standard Chartered Bank is incorporated in England with limited
liability by Royal Charter 1853 Reference Number ZC18 and Standard Chartered Securities (B) Sdn Bhd, which is a limited liability
company registered with the Registry of Companies with Registration Number RC20001003 and licensed by Autoriti Monetari Brunei
Darussalam as a Capital Markets Service License Holder with License Number AMBD/R/CMU/S3-CL. China Mainland: This
document is being distributed in China by, and is attributable to, Standard Chartered Bank (China) Limited which is mainly regulated
by China Banking and Insurance Regulatory Commission (CBIRC), State Administration of Foreign Exchange (SAFE), and People’s
Bank of China (PBOC). Hong Kong: In Hong Kong, this document, except for any portion advising on or facilitating any decision on
futures contracts trading, is distributed by Standard Chartered Bank (Hong Kong) Limited (“SCBHK”), a subsidiary of Standard
Chartered PLC. SCBHK has its registered address at 32/F, Standard Chartered Bank Building, 4-4A Des Voeux Road Central, Hong
Kong and is regulated by the Hong Kong Monetary Authority and registered with the Securities and Futures Commission (“SFC”) to
carry on Type 1 (dealing in securities), Type 4 (advising on securities), Type 6 (advising on corporate finance) and Type 9 (asset
management) regulated activity under the Securities and Futures Ordinance (Cap. 571) (“SFO”) (CE No. AJI614). The contents of
this document have not been reviewed by any regulatory authority in Hong Kong and you are advised to exercise caution in relation
to any offer set out herein. If you are in doubt about any of the contents of this document, you should obtain independent professional
advice. Any product named herein may not be offered or sold in Hong Kong by means of any document at any time other than to
“professional investors” as defined in the SFO and any rules made under that ordinance. In addition, this document may not be issued
or possessed for the purposes of issue, whether in Hong Kong or elsewhere, and any interests may not be disposed of, to any person
unless such person is outside Hong Kong or is a “professional investor” as defined in the SFO and any rules made under that
ordinance, or as otherwise may be permitted by that ordinance. In Hong Kong, Standard Chartered Private Bank is the private banking
division of Standard Chartered Bank (Hong Kong) Limited. Ghana: Standard Chartered Bank Ghana PLC accepts no liability and will
not be liable for any loss or damage arising directly or indirectly (including special, incidental or consequential loss or damage) from
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as to the security or accuracy of any information transmitted via e-mail. The Bank shall not be responsible for any loss or damage
suffered by you arising from your decision to use e-mail to communicate with the Bank. India: This document is being distributed in
India by Standard Chartered Bank in its capacity as a distributor of mutual funds and referrer of any other third-party financial products.
Standard Chartered Bank does not offer any ‘Investment Advice’ as defined in the Securities and Exchange Board of India (Investment
Advisers) Regulations, 2013 or otherwise. Services/products related securities business offered by Standard Charted Bank are not
intended for any person, who is a resident of any jurisdiction, the laws of which imposes prohibition on soliciting the securities business
in that jurisdiction without going through the registration requirements and/or prohibit the use of any information contained in this
document. Indonesia: This document is being distributed in Indonesia by Standard Chartered Bank, Indonesia branch, which is a
financial institution licensed, registered and supervised by Otoritas Jasa Keuangan (Financial Service Authority). Jersey: The Jersey
Branch of Standard Chartered Bank is regulated by the Jersey Financial Services Commission. Copies of the latest audited accounts
of Standard Chartered Bank are available from its principal place of business in Jersey: PO Box 80, 15 Castle Street, St Helier, Jersey
JE4 8PT. Standard Chartered Bank is incorporated in England with limited liability by Royal Charter in 1853 Reference Number ZC
18. The Principal Office of the Company is situated in England at 1 Basinghall Avenue, London, EC2V 5DD. Standard Chartered
Bank is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and Prudential Regulation
Authority. The Jersey Branch of Standard Chartered Bank is also an authorised financial services provider under license number
10Standard Chartered Bank
Wealth Management Chief Investment Office | 11 March 2022
44946 issued by the Financial Sector Conduct Authority of the Republic of South Africa. Jersey is not part of the United Kingdom and
all business transacted with Standard Chartered Bank, Jersey Branch and other SC Group Entity outside of the United Kingdom, are
not subject to some or any of the investor protection and compensation schemes available under United Kingdom law. Kenya: This
document is being distributed in Kenya by, and is attributable to Standard Chartered Bank Kenya Limited. Investment Products and
Services are distributed by Standard Chartered Investment Services Limited, a wholly owned subsidiary of Standard Chartered Bank
Kenya Limited (Standard Chartered Bank/the Bank) that is licensed by the Capital Markets Authority as a Fund Manager. Standard
Chartered Bank Kenya Limited is regulated by the Central Bank of Kenya. Malaysia: This document is being distributed in Malaysia
by Standard Chartered Bank Malaysia Berhad. Recipients in Malaysia should contact Standard Chartered Bank Malaysia Berhad in
relation to any matters arising from, or in connection with, this document. Nigeria: This document is being distributed in Nigeria by
Standard Chartered Bank Nigeria Limited (“the Bank”), a bank duly licensed and regulated by the Central Bank of Nigeria. The Bank
accepts no liability for any loss or damage arising directly or indirectly (including special, incidental or consequential loss or damage)
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into account these factors before making a commitment to invest in an investment. To unsubscribe from receiving further updates,
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via e-mail, as the Bank makes no representations or warranties as to the security or accuracy of any information transmitted via e-
mail. Pakistan: This document is being distributed in Pakistan by, and attributable to Standard Chartered Bank (Pakistan) Limited
having its registered office at PO Box 5556, I.I Chundrigar Road Karachi, which is a banking company registered with State Bank of
Pakistan under Banking Companies Ordinance 1962 and is also having licensed issued by Securities & Exchange Commission of
Pakistan for Security Advisors. Standard Chartered Bank (Pakistan) Limited acts as a distributor of mutual funds and referrer of other
third-party financial products. Singapore: This document is being distributed in Singapore by, and is attributable to, Standard
Chartered Bank (Singapore) Limited (Registration No. 201224747C/ GST Group Registration No. MR-8500053-0, “SCBSL”).
Recipients in Singapore should contact SCBSL in relation to any matters arising from, or in connection with, this document. SCBSL
is an indirect wholly owned subsidiary of Standard Chartered Bank and is licensed to conduct banking business in Singapore under
the Singapore Banking Act, Chapter 19. Standard Chartered Private Bank is the private banking division of SCBSL. IN RELATION
TO ANY SECURITY OR SECURITIES-BASED DERIVATIVES CONTRACT REFERRED TO IN THIS DOCUMENT, THIS
DOCUMENT, TOGETHER WITH THE ISSUER DOCUMENTATION, SHALL BE DEEMED AN INFORMATION MEMORANDUM (AS
DEFINED IN SECTION 275 OF THE SECURITIES AND FUTURES ACT, CHAPTER 289 (“SFA”)). THIS DOCUMENT IS INTENDED
FOR DISTRIBUTION TO ACCREDITED INVESTORS, AS DEFINED IN SECTION 4A(1)(a) OF THE SFA, OR ON THE BASIS THAT
THE SECURITY OR SECURITIES-BASED DERIVATIVES CONTRACT MAY ONLY BE ACQUIRED AT A CONSIDERATION OF
NOT LESS THAN S$200,000 (OR ITS EQUIVALENT IN A FOREIGN CURRENCY) FOR EACH TRANSACTION. Further, in relation
to any security or securities-based derivatives contract, neither this document nor the Issuer Documentation has been registered as
a prospectus with the Monetary Authority of Singapore under the SFA. Accordingly, this document and any other document or material
in connection with the offer or sale, or invitation for subscription or purchase, of the product may not be circulated or distributed, nor
may the product be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly,
to persons other than a relevant person pursuant to section 275(1) of the SFA, or any person pursuant to section 275(1A) of the SFA,
and in accordance with the conditions specified in section 275 of the SFA, or pursuant to, and in accordance with the conditions of,
any other applicable provision of the SFA. In relation to any collective investment schemes referred to in this document, this document
is for general information purposes only and is not an offering document or prospectus (as defined in the SFA). This document is not,
nor is it intended to be (i) an offer or solicitation of an offer to buy or sell any capital markets product; or (ii) an advertisement of an
offer or intended offer of any capital markets product. Deposit Insurance Scheme: Singapore dollar deposits of non-bank depositors
are insured by the Singapore Deposit Insurance Corporation, for up to S$75,000 in aggregate per depositor per Scheme member by
law. Foreign currency deposits, dual currency investments, structured deposits and other investment products are not insured. This
advertisement has not been reviewed by the Monetary Authority of Singapore. Taiwan: Standard Chartered Bank (“SCB”) or Standard
Chartered Bank (Taiwan) Limited (“SCB (Taiwan)”) may be involved in the financial instruments contained herein or other related
financial instruments. The author of this document may have discussed the information contained herein with other employees or
agents of SCB or SCB (Taiwan). The author and the above-mentioned employees of SCB or SCB (Taiwan) may have taken related
actions in respect of the information involved (including communication with customers of SCB or SCB (Taiwan) as to the information
contained herein). The opinions contained in this document may change, or differ from the opinions of employees of SCB or SCB
(Taiwan). SCB and SCB (Taiwan) will not provide any notice of any changes to or differences between the above-mentioned opinions.
This document may cover companies with which SCB or SCB (Taiwan) seeks to do business at times and issuers of financial
instruments. Therefore, investors should understand that the information contained herein may serve as specific purposes as a result
11Standard Chartered Bank
Wealth Management Chief Investment Office | 11 March 2022
of conflict of interests of SCB or SCB (Taiwan). SCB, SCB (Taiwan), the employees (including those who have discussions with the
author) or customers of SCB or SCB (Taiwan) may have an interest in the products, related financial instruments or related derivative
financial products contained herein; invest in those products at various prices and on different market conditions; have different or
conflicting interests in those products. The potential impacts include market makers’ related activities, such as dealing, investment,
acting as agents, or performing financial or consulting services in relation to any of the products referred to in this document. UAE:
DIFC - Standard Chartered Bank is incorporated in England with limited liability by Royal Charter 1853 Reference Number ZC18.The
Principal Office of the Company is situated in England at 1 Basinghall Avenue, London, EC2V 5DD. Standard Chartered Bank is
authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and Prudential Regulation
Authority. Standard Chartered Bank, Dubai International Financial Centre having its offices at Dubai International Financial Centre,
Building 1, Gate Precinct, P.O. Box 999, Dubai, UAE is a branch of Standard Chartered Bank and is regulated by the Dubai Financial
Services Authority (“DFSA”). This document is intended for use only by Professional Clients and is not directed at Retail Clients as
defined by the DFSA Rulebook. In the DIFC we are authorised to provide financial services only to clients who qualify as Professional
Clients and Market Counterparties and not to Retail Clients. As a Professional Client you will not be given the higher retail client
protection and compensation rights and if you use your right to be classified as a Retail Client we will be unable to provide financial
services and products to you as we do not hold the required license to undertake such activities. For Islamic transactions, we are
acting under the supervision of our Shariah Supervisory Committee. Relevant information on our Shariah Supervisory Committee is
currently available on the Standard Chartered Bank website in the Islamic banking section at: https://www .sc. com/en/banking/
islamic-banking/islamic-banking-disclaimers/ UAE: For residents of the UAE – Standard Chartered Bank UAE does not provide
financial analysis or consultation services in or into the UAE within the meaning of UAE Securities and Commodities Authority
Decision No. 48/r of 2008 concerning financial consultation and financial analysis. Uganda: Our Investment products and services
are distributed by Standard Chartered Bank Uganda Limited, which is licensed by the Capital Markets Authority as an investment
adviser. United Kingdom: Standard Chartered Bank (trading as Standard Chartered Private Bank) is an authorised financial services
provider (license number 45747) in terms of the South African Financial Advisory and Intermediary Services Act, 2002. Vietnam:
This document is being distributed in Vietnam by, and is attributable to, Standard Chartered Bank (Vietnam) Limited which is mainly
regulated by State Bank of Vietnam (SBV). Recipients in Vietnam should contact Standard Chartered Bank (Vietnam) Limited for any
queries regarding any content of this document. Zambia: This document is distributed by Standard Chartered Bank Zambia Plc, a
company incorporated in Zambia and registered as a commercial bank and licensed by the Bank of Zambia under the Banking and
Financial Services Act Chapter 387 of the Laws of Zambia.
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