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China Poised for Reopening
In our view, China is poised for reopening and is less likely to implement stringent, extended lockdowns going forward. We believe that the National Health Commission (NHC) will further adjust its Covid policy and gradually do away with daily mass testing (even in cities with no cases) and quarantine measures. Key to watch is the number of severe/fatal cases as the total case count goes up and the take-up of booster vaccinations, especially for the elderly.
- Mutations of Omicron variants appear milder and much less severe than earlier Covid variants.
- Domestically developed vaccines appear to be effective in reducing the severity of symptoms with the booster dose, as seen from Hong Kong data.
- We are witnessing the early days of increasing vaccination rates among the high-risk population, particularly the elderly.
- We believe the recent adjustment to Covid-19 measures is a step in the right direction.
Current Omicron Variant is Less Severe
Based on our analysis of case surges in Hong Kong, Singapore, Korea, and China, it appears that the current variant of Omicron is less severe and fatal than earlier Covid variants. In fact, data from Hong Kong and Singapore suggest that the
Our analysis of Covid case surges in China in
Domestic Vaccines Have Proven Effectiveness
While the initial efficacy data for domestically-developed vaccines were sub-optimal, booster doses of domestic vaccines are still effective at reducing the severity of symptoms. We analysed booster data from HK by comparing one of China’s domestically-developed vaccines (Sinovac) with
Uptick in Boosters for High-Risk Elderly Group
Though early days, we are witnessing a pick up in booster doses, especially among the high-risk elderly group. China achieved full vaccination (2 doses) very quickly, with over 90% of the population receiving two doses, but the booster shot rate has slowed down in recent months, especially among the 60+ age group. However, recently we have seen multiple municipal governments promoting boosters (including Shanghai, Guangdong, Jiangsu, and Tianjin), which is encouraging and could be a precursor for opening up.
New Easing Measures Are a Positive Sign
In our view, the recent adjustment to China’s Covid-19 measures are a step in the right direction. Following the Politburo Standing Committee’s (PSC) meeting on 10 November, the State Council released a notice to loosen pandemic controls while insisting on a dynamic zero-Covid strategy. The key takeaways include the following:
- Shortening the quarantine period for overseas travellers and close contact to “5 days in centralised quarantine + 3 days home quarantine” from the previous “7 days in centralised quarantine + 3 days home self-monitoring”;
PCRtests only if the infection sources or the transmission paths are unclear, community spread lingers for a long time, or for correcting unreasonable practices such as “two tests a day” and “three tests a day”;
- Removing circuit breaker mechanism for inbound flights and adjusting the requirement on 48-hour nucleic acid test before the flight from twice to once;
- Promoting Covid vaccination rate, especially booster rate among elderlies; and
- Accelerating the research and development (R&D) of effective anti-Covid vaccines and drugs.
Staying Ahead with Mirae Asset’s Latest Insights
Disclaimer & Information for Investors
No distribution, solicitation or advice: This document is provided for information and illustrative purposes and is intended for your use only. It is not a solicitation, offer or recommendation to buy or sell any security or other financial instrument. The information contained in this document has been provided as a general market commentary only and does not constitute any form of regulated financial advice, legal, tax or other regulated service.
The views and information discussed or referred in this document are as of the date of publication. Certain of the statements contained in this document are statements of future expectations and other forward-looking statements. Views, opinions and estimates may change without notice and are based on a number of assumptions which may or may not eventuate or prove to be accurate. Actual results, performance or events may differ materially from those in such statements. In addition, the opinions expressed may differ from those of other Mirae Asset Global Investments’ investment professionals.
Investment involves risk: Past performance is not indicative of future performance. It cannot be guaranteed that the performance of the Fund will generate a return and there may be circumstances where no return is generated or the amount invested is lost. It may not be suitable for persons unfamiliar with the underlying securities or who are unwilling or unable to bear the risk of loss and ownership of such investment. Before making any investment decision, investors should read the Prospectus for details and the risk factors. Investors should ensure they fully understand the risks associated with the Fund and should also consider their own investment objective and risk tolerance level. Investors are advised to seek independent professional advice before making any investment.
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Information for EU investors pursuant to Regulation (EU) 2019/1156: This document is a marketing communication and is intended for Professional Investors only. A Prospectus is available for the Mirae Asset Global Discovery Fund (the “Company”) a société d'investissement à capital variable (SICAV) domiciled in Luxembourg structured as an umbrella with a number of sub-funds. Key Investor Information Documents (“KIIDs”) are available for each share class of each of the sub-funds of the Company.
The Company’s Prospectus and the KIIDs can be obtained from www.am.miraeasset.eu/fund-literature . The Prospectus is available in English, French, German, and Danish, while the KIIDs are available in one of the official languages of each of the EU Member States into which each sub-fund has been notified for marketing under the Directive 2009/65/EC (the “UCITS Directive”). Please refer to the Prospectus and the KIID before making any final investment decisions.
A summary of investor rights is available in English from www.am.miraeasset.eu/investor-rights-summary/.
The sub-funds of the Company are currently notified for marketing into a number of EU Member States under the UCITS Directive. FundRock Management Company can terminate such notifications for any share class and/or sub-fund of the Company at any time using the process contained in Article 93a of the UCITS Directive.
Hong Kong: It is intended is for Hong Kong investors. Before making any investment decision to invest in the Fund, Investors should read the Fund’s Prospectus and the information for Hong Kong investors (of applicable) of the Fund for details and the risk factors. The individual and Mirae Asset Global Investments (Hong Kong) Limited may hold the individual securities mentioned. This document is issued by Mirae Asset Global Investments (HK) Limited and has not been reviewed by the Securities and Futures Commission.
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Swiss investors: This document is intended for Professional Investors only. This is an advertising document. The Swiss Representative is 1741 Fund Solutions AG, Burggraben 16, CH-9000 St. Gallen. The Swiss Paying Agent is Tellco AG, Bahnhofstrasse 4, CH-6431 Schwyz. The Prospectus and the Supplements of the Funds, the KIIDs, the Memorandum and Articles of Association as well as the annual and interim reports of the Company are available free of charge from the Swiss Representative.
UK investors: This document is intended for Professional Investors only. The Company is a Luxembourg registered UCITS, recognised in the UK under section 264 of the Financial Services and Markets Act 2000. Compensation from the UK Financial Services Compensation Scheme will not be available in respect of the Fund. The taxation position affecting UK investors is outlined in the Prospectus. This document has been approved for issue in the United Kingdom by Mirae Asset Global Investments (UK) Ltd, a company incorporated in England & Wales with registered number 06044802, and having its registered office at 4th Floor, 4-6 Royal Exchange Buildings, London EC3V 3NL, United Kingdom. Mirae Asset Global Investments (UK) Ltd. is authorised and regulated by the Financial Conduct Authority with firm reference number 467535.
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