Chinese Chinese Chinese

Chinese property developers rebound, Iron ore red hot, Apple ups Ante, Resilience of Singapore REITs

Equities 6 minutes to read
APAC Strategy Team

Summary:  Friday’s US jobs report to support Fed’s tightening plans. More sanctions on Russia might mean further oil price gains. The Iron ore is bullish on Ukraine rebuilding down the track. BHP shares surge back to record highs, and are likely to continue to push higher, defying analyst expectations. Why to consider looking at Apple. Singapore REITs to consider despite the upcoming Fed rate hikes. Also, the lithium stocks to watch amid the US policy shift. The Australian dollar supported higher over the long term. RBA and RBI central bank meetings in the week ahead may bring some attention back to inflation.

Co-written by Market Strategists Jessica Amir in Australia, Redmond Wong in Hong Kong, Charu Chanana in Singapore.


What’s happening in markets?

U.S. March job report was very good. There were strong increases everywhere : payrolls +431k, private +426k including +60k in goods and +366k in services, and government +5k. The month of February was revised upward (+95k). The unemployment is now at 3.6 % versus prior 3.8%, reaching pre-pandemic lows. And given that the Fed's one of the mandates is full employment this opens the door to a strong interest rate hike by the U.S. Federal Reserve in May and possibly in June if the trends continue. It also adds weight to our arguments that the inversion of the yield curves is unlikely to deter the Fed from hiking rates aggressively. We may get some verbal comfort from the Fed speakers on the yield curve inversion, but rate hikes will continue.

The Australia share market (ASX200) started the trading week higher, up 0.4% at the open on Monday with most sectors rising, following a positive close for US and European markets on Friday. The market is again being pulled higher by commodities stocks and sector, and the ASX200 is about 1% off hitting its all-time high, and could break even higher this or next week. However the market will be cautious tomorrow amid the announcement from the Reserve Bank of Australia’s (RBA) monthly meeting (Tuesday, April 5).

Hong Kong’s Hang Seng (HSI.I) and China’s CSI300 (000300.I). Shanghai and Shenzhen markets are closed for national holiday today and tomorrow.  Last Friday, Chinese ADRs rallied sharply following reports that Chinese authorities were preparing to give U.S. regulators “full” access to auditing reports of the majority of the 200-plus companies listed in the U.S.  The NASDAQ Golden Dragon China Index (HXC.I)  rose 4.7%.  On Saturday, China Securities Regulatory Commission (CSRC) jointly with other relevant regulators, issued a consultation document to gather opinions from the public about proposed revision of the Chinese law to allow foreign regulatory entities’ access to audit work papers and conduct relevant instigations under some relaxed conditions. Hang Seng Index and Hang Seng TECH Index (HSTECH.I) were 1.5% and 3% higher respectively. Bilibibi (09626) rose more than 10% and Baidu (09888) surged 7%.

Apple’s iPhone earnings are set to soar, it works on its iPhone hardware subscription service that will shake up the sector. iPhones are Apples biggest source of sales, with the company making $192 billion from iPhones last year (that’s ½ of the company’s revenue),  However once Apple rolls out its new iPhone subscription service, where customers will be able to automatically upgrade their iPhone, it will create a new reoccurring sales item for Apple, and also take market share from Australia’s Telstra (TLS), JB Hi-Fi (JBH) on the ASX, and from the US’s Amazon (AMZN), Walmart (WMT), Best Buy (BBY), Target (TGT).

What to consider?

The Russia-Ukraine situation is getting worse and we need to brace for sanctions getting more severe. Russia’s attacks on Ukraine are getting brutal and some European nations are pushing for ratcheting up sanctions. This can mean some risk off for the markets and some further supply shocks. With the Bloomberg Commodity Spot index losing 1.5% on the week and oil still in a bearish trend following the release of U.S. strategic reserves, this may mean some good entry points to get exposure in oil. China’s demand shock is likely temporary, and consumption and investment demand will be revived by policy stimulus to meet the goal of 5% growth this year. The extended war scenario, however, further raises the risk of food supply shocks which is key for Asia.

AUDUSD on watch with the RBA expected to announce inflation is un-sustainably higher than its target of 2-3% price growth, fueled by oil price growth. This means the RBA could now be forced to bring forward its interest rate hikes. Currently the market is pricing in almost 7 interest rate hikes and for rate to first hike in June, with rates to peak at 1.75% at the year end. Traditionally, as we know, a currency will be supported higher if rates are rising. But markets doesn't like bad surprises. However, in saying this, the Aussie dollar will likely rise if the RBA maps rate hikes sooner than June. If the RBA is more dovish, we could see a small pull back before the AUD resumes its bullish long term uptrend. 

Weak March Chinese home sales data but more relaxation of local government housing policies. The top 100 developers in mainland China reported sales volume down 56.5% YoY in March, according to the China Real Estate Information Corporation.  Likewise, WIND data showed that new home sales in 30 major cities declined  47.7% YoY in March. The land sales volume and value fell 47.2% and 74.7% YoY respectively in the 100 largest cities in China in March. Amid these weaknesses, local government in about 60 Chinese cities have recently relaxed housing policies, including lifting ban on non-registered households to buy properties, handing out home buying subsidies, lowering minimum down payments, and lowering mortgage interest rates. 

Australia and India deepen trade ties. India and Australia signed economic pact; cutting tariffs on over 85% of goods exported to India. What does it mean for Australia? It opens the door to 1.4 billion people, and will support the Aussie economy, with exports to increase in farming and agriculture, and this supports the Australian dollar (AUDUSD) rising over the long term.

The iron ore price (SOCA) continues its rebound, up 1.2% to $163.20 on Monday (its highest level since March), on expectations China will ramp up steel production, while markets begin to factor in Ukraine will need iron ore (for steel) to rebuild. The world’s biggest iron ore company, BHP (BHP) has seen its shares rise to AU$52.47, which is its highest level since August last year, meaning BHP has now wiped out all of the losses caused by China announcing it would cut its emissions levels.

Singapore PMI is due later on Monday. While we may see some easing from February’s 50.2, the outlook is likely to remain upbeat as the economy reopens in a big way from April. Official statements have been reassuring that even though reopening of borders might mean another surge in COVID cases, but there is unlikely to be further tightening of measures unless the hospital infrastructure comes under stress.

Trading ideas to consider

The rebound in Chinese property developers may have legs. Despite of still weak home sales and land sales data, the rally of share prices of Chinese property developers may continue as local governments seems having the green light from the Central Government to continue to relax or reverse the restrictive measures that they had put on the property sector last year. 

Lithium companies in America poised for strong revenue and share price growth. With lithium carbonate prices for June quarter contracts up 30% than the higher previous quarter, lithium produces are set to make higher earnings and see higher share price growth. For those wanting to invest in lithium, amid rising demand and fiscal support from Biden’s administration, you could look at lithium producers in the American region like Albemarle (ALB). The market thinks Albemarle will see a 32% jump in revenue growth this year and its shares look like they’re about break out from a technical perspective. Livent (LTHM) also looks bullish from a technical perspective on the day and week chart. While the market thinks lithium producer Allkem (AKE) will see revenue growth of 740% this year. Allkem is the 5th biggest lithium producer in the world. If you don’t want to pick stocks though, look at the ETF; ETFs Battery Tech & Lithium ETF (ACDC), which also looks like it could break out and head higher in the short term.

Singapore REITs may be exposed to volatility as rising inflation concerns and increases in interest rates underpin. High oil prices and continued threat to supply chains is also a key concern. But financial metrics remain robust, and Singapore’s domestic and border reopening suggests some tailwinds ahead. For exposure to hospitality REITs, you could consider Ascott Residence Trust (SGX:HMN), CDL Hospitality Trusts (SGX:J85), Far East Hospitality Trust (SGX:Q5T). Suntec REIT and Keppel REIT may be more exposed to higher interest rates due to the high proportions of debt in floating rates and high leverage ratios. Some of the ETFs to consider are Lion Phillip S-REIT (SREITS) and AXJREIT.

Key economic releases this week:

Apr 4: Singapore PMI
Apr 5: Japan Household Spending, RBA Meeting
Apr 8: Japan Current Account Balance Adjusted, RBI Meeting

For a global look at markets – tune into our Podcast. 


Saxo Capital Markets (Australia) Limited prepares and distributes information/research produced within the Saxo Bank Group for informational purposes only. In addition to the disclaimer below, if any general advice is provided, such advice does not take into account your individual objectives, financial situation or needs. You should consider the appropriateness of trading any financial instrument as trading can result in losses that exceed your initial investment. Please refer to our Analysis Disclaimer, and our Financial Services Guide and Product Disclosure Statement. All legal documentation and disclaimers can be found at

The Saxo Bank Group entities each provide execution-only service. Access and use of Saxo News & Research and any Saxo Bank Group website are subject to (i) the Terms of Use; (ii) the full Disclaimer; and (iii) the Risk Warning in addition (where relevant) to the terms governing the use of the website of a member of the Saxo Bank Group.

Saxo News & Research is provided for informational purposes, does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. No Saxo Bank Group entity shall be liable for any losses that you may sustain as a result of any investment decision made in reliance on information on Saxo News & Research.

To the extent that any content is construed as investment research, such content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication.

None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments.Saxo Capital Markets does not take into account your personal investment objectives or financial situation and makes no representation and assumes no liability as to the accuracy or completeness of the information nor for any loss arising from any investment made in reliance of this presentation. Any opinions made are subject to change and may be personal to the author. These may not necessarily reflect the opinion of Saxo Capital Markets or its affiliates.

Please read our disclaimers:
- Full Disclaimer (
- Analysis Disclaimer (
- Notification on Non-Independent Investment Research (

Saxo Capital Markets (Australia) Limited
Suite 1, Level 14, 9 Castlereagh St
Sydney NSW 2000

Contact Saxo

Select region


The Saxo trading platform has received numerous awards and recognition. For details of these awards and information on awards visit

Saxo Capital Markets (Australia) Limited ABN 32 110 128 286 AFSL 280372 (‘Saxo’ or ‘Saxo Capital Markets’) is a wholly owned subsidiary of Saxo Bank A/S, headquartered in Denmark. Please refer to our General Business Terms, Financial Services Guide, Product Disclosure Statement and Target Market Determination to consider whether acquiring or continuing to hold financial products is suitable for you, prior to opening an account and investing in a financial product.

Trading in financial instruments carries various risks, and is not suitable for all investors. Please seek expert advice, and always ensure that you fully understand these risks before trading. Saxo Capital Markets does not provide ‘personal’ financial product advice, any information available on this website is ‘general’ in nature and for informational purposes only. Saxo Capital Markets does not take into account an individual’s needs, objectives or financial situation. The Target Market Determination should assist you in determining whether any of the products or services we offer are likely to be consistent with your objectives, financial situation and needs.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the US and other countries. AppStore is a service mark of Apple Inc.

The information or the products and services referred to on this website may be accessed worldwide, however is only intended for distribution to and use by recipients located in countries where such use does not constitute a violation of applicable legislation or regulations. Products and Services offered on this website is not intended for residents of the United States and Japan.

Please click here to view our full disclaimer.