Table of Contents
Time to think about exit strategy 3
Positive drivers had been in play, but dissipating 3
Global quantitative easing (QE) => Long-term interest rate still rising 3
􀂾 Hong Kong dollar peg speculation unjustified 4
􀂾 Hong Kong Dollar strength 4
􀂾 Speculated buying by Chinese sovereign funds (before 1 October?) 5
􀂾 Guangdong trough-train 5
􀂾 HK ETFs and companies to be listed in China 5
Sharp PRC loan growth unsustainable 7
􀂾 They know bullet-biting is unavoidable 7
Valuation no longer cheap 8
Influential people talking market up 10
Slower decline in economic data means it is still deteriorating 10
Meaningful USD rebound possible in a secular down trend 10
China said buying commodity no more 11
Potential further positive catalysts 12
Negatives were ignored, but will come into play 12
Economic data may disappoint stock market 12
PRC exports and FDI remain weak 13
Potential triggers for material correction: 14
US data & results season 14
􀂾 US credit card market 15
􀂾 US mortgage market 16
􀂾 US housing market 18
Foreclosure supply rising 19
China starts tightening 20
Stronger USD 20
Further hike in US bond yield 21
Market starts looking at cost of production 21
Remain positive longer term 22