Pop Mart's stock rally outperforms the market, driven by the popularity of toys from Labubu to Ne Zha. Morgan Stanley has identified the Chinese toy manufacturer as a top choice, forecasting a significant improvement in their earnings this year due to robust sales.

Following its triumph with Labubu, Pop Mart International is experiencing another surge in intellectual property (IP) merchandising, with its toys inspired by China's top-earning Ne Zha 2 being rapidly purchased by consumers. This has led the prominent US investment bank, Morgan Stanley, to highlight the stock as one of its premier choices.

The Ne Zha toys from Pop Mart were completely bought up just days after being launched on January 30. This happened concurrently with the animation setting new local box office records, as reported by the state-run China Movie Database on Thursday. The follow-up also surpassed The Battle at Lake Changjin in terms of total ticket sales, after an impressive performance during the Lunar New Year holiday.

Morgan Stanley analysts, such as Dustin Wei and Carol Xia, anticipate that Pop Mart will evolve into a primary collaborator for worldwide IP owners who aim to generate profit and boost the fame of their IP through IP toys. They further emphasized that the company's success accentuates its sway in the IP strategy.

Analysts stated that while third-party Intellectual Properties such as Ne Zha constituted only 15 to 20 percent of Pop Mart's earnings, they were instrumental in successfully attracting new clientele for the brand.

"China dominates globally" is the message as DeepSeek demonstrates its power in high-value industries, according to Deutsche Bank. DeepSeek's rise represents a pivotal moment, not just for Artificial Intelligence, but also for China, as it outperforms the rest of the world, says the bank. The emergence of DeepSeek is indeed a turning point not only for AI, but also for China, which is excelling beyond global competition, the bank reiterates.

The unveiling of DeepSeek has shaken the global conviction that they "could restrain China," as expressed by Deutsche Bank. They referred to the introduction of the artificial intelligence (AI) technology as China's "Sputnik moment".

The bank is describing the success of the start-up as a major milestone for the nation, presenting a perspective that exceeds that of Marc Andreessen, a prominent venture capitalist based in Silicon Valley. Andreessen likened DeepSeek's progress to the AI industry's equivalent of the Sputnik moment. These remarks are a nod to the time when the Soviet Union launched the first-ever artificial satellite in 1957, immediately altering the world's view of the nation.

According to a report titled "China Eats the World" by Deutsche Bank on Wednesday, it is projected that by 2025, the global investment community will recognize China's dominance over its global competitors, as reported by the Post.

The bank had always been positive about Chinese corporations, though it was unsure about the exact catalyst that would spark a worldwide interest in them, until this moment, according to its statement. "We're of the opinion that the upward trend in the market for stocks in Hong Kong and China kicked off in 2024, and it's set to surpass previous records in the foreseeable future," stated the report, penned by Peter Milliken, who heads the Asia-Pacific corporate research division at the bank, based in Hong Kong.

The bank reported that China's hold over high-profit sectors was growing at an unparalleled rate. As companies at the forefront globally continue to increase their market share in various sectors, it's expected that China's contribution to global market value will soon exceed single-digit percentages.

The sudden popularity of DeepSeek has sparked a surge in Chinese tech stocks and instigated a drop in firms listed on Nasdaq. The Hang Seng Tech Index, spearheaded by leading corporations like Tencent Holdings, Alibaba Group Holding, and Xiaomi, neared a four-month peak on Thursday after a more than 10 per cent upswing in the last two weeks. The wider Hang Seng Index also experienced a roughly 6 per cent increase. Shares of DeepSeek, established in the Zhejiang province's capital, Hangzhou, by Liang Wenfeng in 2023, are not available on the public market.

Stocks in Hong Kong have seen a rise due to positive sentiment in the tech sector, marking the highest weekly increase since October. The Hang Seng Index is nearing its October height, even as some investors are waiting for employment data from the US to guide them on decisions about interest rates.

Hong Kong shares rose following increases in tech firms, driving the city's key index to its best weekly performance in four months. This rise occurred despite some investors scaling back their stakes ahead of a US employment report, which may provide insights into future interest rate trends.

The Hang Seng Index increased by 1.2% ending at 21,133.54 when trading closed on Friday, and the Tech Index also saw a rise of 1.8%. Both indices saw a significant rise from the previous week, with increases of 4.5% and 9% respectively. Over in mainland China, the CSI 300 Index experienced a 1.3% rise, while the Shanghai Composite Index went up by 1%.

Lenovo Group saw a significant increase of 6.3 per cent, reaching HK$12.22, while Xiaomi experienced a 4.7 per cent jump to HK$42.45, following their announcement of a new electric vehicle (EV) and a range of new phones. HSBC adjusted Xiaomi's price target upwards to HK$49.90 from HK$37.90, citing it as the major recipient of China's subsidy scheme.

Huatai Securities has increased the price target for PC manufacturer Lenovo from HK$13.30 to HK$13.85. This change is due to the anticipated rise in demand for PC capabilities, largely due to DeepSeek's efforts to make artificial intelligence (AI) more easily available to the public.

"Tech shares have seen a notable increase in recent weeks and are expected to keep climbing due to an influx of capital," stated Kenny Wen, the chief of investment strategy at KGI Asia. The rise in Chinese stocks has not yet capitalized on the improvement in their long-term foundational aspects, he further mentioned.

Electric vehicle producer Geely Automobile saw a 8.1 per cent increase in its stock value to HK$17.72, leading the way in industry growth. Li Auto also experienced a significant growth of 7.6 per cent, bringing its stock value to HK$103.20, while BYD also saw a 4.5 per cent rise to HK$330. Additionally, solar panel manufacturer Xinyi Solar's stock value went up by 7.8 per cent to HK$3.59.

Hong Kong: A global hub for family offices

Being a top-tier international finance hub, Hong Kong is cementing its role as the go-to place for setting up family offices.

Hong Kong, being a leading global financial hub in Asia, offers a perfect setting for family offices and investors who are interested in capitalizing on investment prospects in mainland China, the Asia-Pacific region and worldwide markets.

Over 2,700 single-family offices are currently functioning, as per a recent market analysis by Deloitte, making Hong Kong a prime location for managing wealth and diversifying investments. A significant advantage in Hong Kong is that these single-family offices don't need to obtain licenses to operate, thereby simplifying their operations by avoiding intricate regulatory systems.

"Hong Kong has positioned itself as a top choice for family offices, providing a mix of regulatory benefits, financial facilities, and worldwide links," states Cameron Harvey, the chief executive of Landmark Family Office, highlighting the elements that the office took into account before setting up its international headquarters in the metropolis. Key factors that swayed Landmark's choice included Hong Kong's diverse financial product offering, specialist consulting services, and adaptable investment options.

Beneficial environment

These services and benefits, integral to the city's emerging ecosystem, aid in the complex handling of assets, making certain that family offices can smoothly operate in both local and global markets and safeguard their financial heritage for future generations. "Together, these elements improve investment opportunities, assisting in the expansion and maintenance of wealth," says Harvey.

Over 70 of the globe's 100 leading banks are headquartered in Hong Kong. The city also boasts a wealth of skilled financial experts who provide services in areas such as accounting, insurance, global tax matters, wealth guidance, and investment consultation.

Landmark also conveyed their trust in Hong Kong's strong legal and regulatory structure, as well as its autonomous judiciary, which is a significant factor for extremely wealthy individuals residing in other parts of Asia.

HSBC is contemplating a revamp of the CEO's remuneration structure as UK banks abandon bonus limits. The current proposal would significantly reduce CEO Elhedery's base salary, but his possible bonus could increase substantially, according to someone with knowledge of the matter.

HSBC Holdings is contemplating reducing the base salary of its new CEO, Georges Elhedery, by 50%. This comes after the UK adjusted its regulations, permitting a larger portion of compensation to be derived from performance-based bonuses.

At present, Elhedery earns a basic wage of £1.38 million (HK$13.3 million), supplemented by a fixed compensation worth £1.7 million. Additionally, he is eligible for a yearly bonus of up to 215% of his base wage and a long-term prize potentially amounting to 320% of his wage. Coupled with a pension allowance, his total package can reach up to approximately £10.6 million annually.

The bank based in London might offer Elhedery a deal valued up to £15 million as part of a new scheme currently under consideration, according to an anonymous source close to the matter who requested anonymity prior to any official statement. Sky News was the first to reveal specifics of the new incentives. Although his base salary would possibly be cut by about 50%, his potential bonus could significantly increase, the source mentioned.

"Although no final choices have been made, the compensation committee's goal is to ensure that the pay results for our executive directors are closely tied to performance and the interests of our shareholders," stated a spokesperson for HSBC.

The financial institution is set to release information about the reimbursement in conjunction with its annual financial report on February 19, as per the announcement. HSBC is currently undergoing a widespread restructuring, resulting in the departure of numerous senior leaders and the gradual cessation of some of its investment banking activities in Europe and the Americas.

Previously, the UK had essentially restricted banking bonus payouts to double the basic wage, following European Union limits initially put in place in 2014 due to public backlash from the worldwide financial crisis. However, towards the end of 2023, British authorities lifted these restrictions as part of a wider effort to enhance the appeal of post-Brexit Britain as a financial hub.

Numerous other financial institutions in the UK, such as Barclays, Goldman Sachs, and JPMorgan Chase, have been eliminating those constraints and revamping top-level salaries following the modifications to the rules.

Commentary | Response tariffs are not the ideal answer to Trump's aggressive tactics

While the impulse to fight back is understandable, there are more effective strategies that won't damage local economies as tariffs tend to.

However, it's uncertain why revenge is considered standard and favorable when the tariffs that instigate them are rightfully seen as absurd. Policymakers in other areas must not overlook the reality that Trump has decided to ignore: the primary burden of tariffs is carried domestically.

The urge to fight back is innate. To discourage a playground tormentor, one needs to challenge him with resolute resistance. However, instead of discouraging Trump, tariffs imposed by other nations will only fuel his misguided complaints. Crucially, the rationale of counterattack doesn't apply in this situation.

Despite Trump's assertions, it's predominantly American consumers and businesses utilizing imported resources who bear the cost of US tariffs. Hence, the idea of an "ideal tariff" that could potentially allow a country to profit by wielding monopoly power on global markets, doesn't appear to be relevant.

Two minutes past two

US halts duties on Canada and Mexico

Decade in China: The Transformation of Global Businesses' Supply Chains Amidst Trump 2.0

Companies are diverting their products through a range of emerging markets to escape the expanding tariff system of the US – stretching from Poland to South Africa.

During his initial tenure, US President Donald Trump instigated a trade conflict with Beijing. Consequently, numerous multinational corporations implemented a "China+1" approach to cope with the unpredictable new circumstances.

The plan involved moving sections of their supply chains out of China's manufacturing centers and into emerging investment areas like Vietnam and Mexico, in order to lessen the effects of US tariffs targeted at Chinese imports.

Presently, certain companies are recognizing that they might have to reassess their plans in order to manage the potential challenges of a more assertive second Trump administration.

Ever since resuming his role, the American President has declared his intentions to impose a 25% tariff on both Mexico and Canada, as well as increase the tax on Chinese commodities by 10%.

Numerous investors are concerned that the US may impose additional restrictions on markets deemed to be transit points for Chinese products. As a result, some are exploring various new markets, stretching from India to South Africa, for diversification.

HSBC lowers price target for New World, proposing a debt strategy and capital infusion to reassure investors. The company's stock has fallen by 37%, equivalent to a decline of approximately US$822 million in market value, since the end of November when a change in management didn't manage to placate investors.

Analysts at HSBC Holdings suggest that New World Development (NWD) might require a strategy to decrease debt or a monetary contribution from the wealthy Cheng family to alleviate a cash flow crisis and reassure stockholders.

The firm's stocks have plummeted by 37 per cent, which equates to a market value loss of HK$6.4 billion (US$821.7 million) since late November, due to a failed management restructuring that left investors unsettled. Even though the stocks saw a 4.6 per cent increase in a late surge on Friday, they were still close to an all-time low of HK$4.04 recorded on January 25. HSBC has also reduced its stock-price forecast for the second time this year, due to a bleak profit projection.

"A comprehensive and all-encompassing plan to reduce debt, as opposed to refinancing, could serve to ease the worries of investors," state HSBC analysts Raymond Liu and Michelle Kwok in their report. "Robust backing from its parent company, potentially in the form of a capital infusion, might also be beneficial."

HSBC has reduced its price target for NWD to HK$3.66, following a previous decrease to HK$4 from HK$5.60 on January 7, as per Bloomberg data. Of the 19 analysts monitoring the stock, 11 recommend selling NWD, while four suggest holding and four endorse buying. Jefferies is the most pessimistic, setting a price target of HK$2.

DeepSeek's AI technology provides a significant enhancement to China's smart glasses industry, challenging Meta. The cost-effective and robust models of this start-up have essentially transformed the financial aspects of AI implementation, according to the founder of smart glasses company Rokid.

Zhu believes that DeepSeek is revolutionizing the industry. By leveraging China's strength in hardware supply chain and optics, DeepSeek's AI models provide a more adaptable approach for the smart glasses market. This could potentially boost the acceptance and use of these products, he suggested.

Gaw Capital from Hong Kong acquires a major shopping mall in downtown Tokyo for over a billion US dollars. The Tokyu Plaza Ginza, located in the Ginza district, stands as one of the most expansive retail establishments in the area and is conveniently close to several subway stations.

Gaw Capital, a private equity company from Hong Kong specializing in property, has successfully finished purchasing a shopping mall located in the heart of Tokyo. This marks their biggest deal in Japan so far, with a transaction value exceeding US$1 billion.

Gaw collaborated with the Singapore-based firm Patience Capital Group to purchase and oversee Tokyu Plaza Ginza. According to a statement released by Gaw on Friday, they own 91% of the project while their partner possesses the remaining 9%.

Finalized in 2016, Tokyu Plaza Ginza stands as one of the biggest shopping centers in the Ginza area, conveniently located near several subway stops, and boasts a total floor space of 50,093 square meters.

Gaw stated its commitment to capitalizing on opportunities in Japan's dynamic market. It mentioned that it manages approximately 655 billion yen (US$4.7 billion) worth of assets across Japan.

"Given the positive macroeconomic basics that are bolstering Japan's retail industry, now is an excellent time to invest," stated Isabella Lo, investment managing director and chief of Japan operations at Gaw Capital.

DeepSeek cautions about fraudulent social media profiles as the AI app gains immense popularity. The Chinese AI company has advised people to be alert about accounts pretending to be its founder or trading cryptocurrencies under its brand name.

The firm stated that their flagship chatbot application can be downloaded at no cost and they have not released any form of cryptocurrency. They further clarified that any social media circles requesting fees under DeepSeek's name are likely scams.

Five o'clock

Could China's affordable DeepSeek signal the downfall of Nvidia's reign in the chip market?

The rising fame of DeepSeek, along with its discreet presence, has turned the company into a major subject for false information.

In Perspective | Trump's 'exploit and extract' approach exacerbates worldwide environmental crisis

The significant damage lies in the strengthening of the American fossil fuel sector and the coercion on US financial powerhouses to divert from financing environmental objectives.

The Centre for American Progress critiques Trump's choice, stating it blatantly dismisses scientific facts, sabotages decades of committed international teamwork, damages the US economy and its citizens, and sends a perilous message that the country majorly accountable for the climate crisis is neglecting its ethical and pragmatic duties.

Trump seems indifferent to this issue. Currently, the US is one of only four countries that remain detached from global climate initiatives, along with Libya, Iran, and Yemen. Under regular circumstances, the US might label this unusual alliance as a coalition of climate adversaries.

What damage has Trump truly inflicted? In terms of immediate, tangible impact, he has pulled away monetary backing from the UN Framework Convention on Climate Change (UNFCCC), a program whose goals are implemented through the Paris Agreement.