DBS Bank believes that gold is predicted to point out an upward trend, and therefore the target for this year is temporarily set at US$2,000/oz/
What investment opportunities are worth listening to within the second quarter of this year? Deng Zhijian, an investment strategist within the Investment Products Department of DBS Bank, gave answers at a media communication meeting held recently.
He said that the theme of the second quarter was “revived.” After experiencing the whole epidemic, China’s economy has not been very bad. Globally, China’s economy is before many countries, and therefore the resumption of labor and production is that the earliest. Moreover, the whole industrial assembly line , production chain, and provide chain have all recovered.
Regarding investment opportunities during and after the epidemic, he believes that good industries are often sustained and can have long-term growth prospects, like technology and medical services. These sectors have rigid demands and can not be suffering from the epidemic.
In addition, since the fourth quarter of 2020, the financial sector has also begun to point out a growth trend.
Regarding the investment strategy for the second quarter of this year, Deng Zhijian said that he can pay more attention to high-interest strategies and use different assets to extend dividend income. for instance , global high-yield stocks and high-yield bonds are going to be added to the investment scope.
So, within the second quarter of 2021, which industries will DBS Bank promote? Deng Zhijian introduced that the investment strategy of this quarter is optimistic about five directions.
The first is e-commerce. However, it’s not ordinary e-commerce, but e-commerce 2.0, that is, the e-commerce ecosystem. within the entire ecosystem, technology service companies within the upstream of e-commerce are vital , including cloud computing, data centers, and AI AI . The downstream of e-commerce is consumer terminals. during this regard, there’ll even be tons of room for investment in APP software, payment systems, and future digital currencies.
In addition, logistics also plays a crucial role within the development of e-commerce. additionally to logistics stocks, logistics-related land investment trusts within the global market also are excellent investment opportunities.
The second is semiconductor. Every aspect of semiconductors can still invest, because the R&D, expenditure, capital and other aspects of semiconductor companies will grow within the future, and a few companies also will have broad development prospects.
The key to semiconductor development lies in Asia. Important links within the semiconductor industry chain, like packaging, testing, and lithography machines, are all located in Asia. Therefore, the semiconductor industry has great investment prospects, and investment opportunities within the Asian market can’t be ignored.
The third is large banks. China’s six large banks (the Industrial and Peasant China Construction of Diplomatic Relations) have basically promised to allocate 30% of their profits within the future to pay dividends. At current prices, the dividend rate can basically be maintained at quite 5%.
“The dividend payout ratio of the whole US banking industry is merely about 1.8%. Moreover, among numerous industries in China, banks are theoretically the industry with the very best dividend payout, which is extremely attractive.” Read this point made below.
Interest rates are currently falling in the global market and, as a result, in the Chinese market. As a result, maintaining such a high dividend payout ratio is extremely important for Chinese banks. Large banks will be considered by retirement pensions, large funds, and individual investors in the future. Stocks are an investment vehicle. Save for the long term and slowly reap the benefits.
The fourth is that the data center. After all, all technology industries need the exchange and circulation of knowledge . However, not every company has the power to create its own data center. Therefore, there’s an enormous demand for outsourcing to create a knowledge center.
The fifth is that the industries that enjoy vaccines, including catering, tourism, aviation, and energy.
In subsequent one or two quarters, we’ll increase our specialise in the financial sector. In China, we are hopeful about large bank stocks. The banking sector in the United States is expected to perform poorly, but things have changed dramatically since the second half of last year. Since October 2020, the banking sector has grown at a faster rate than the technology sector.
In addition, Deng Zhijian is additionally very optimistic about gold investment opportunities. Gold is important in a number of our customers’ investment portfolios.
Why is gold bullish? He said that there are two reasons to push up the worth of gold within the future. One is that the US dollar are going to be weaker, which is sweet for gold. The second is that as long because the liquidity becomes more and more abundant, the demand for gold will increase.
He predicts that a minimum of before 2023, global liquidity is unlikely to decrease. Therefore, gold remains expected to point out an upward trend. This year, we’ve set a temporary target of $2,000 per ounce.