European Capital Goods: On The Road: China trip takeaways – 'K-shaped' trajectory

研报英文原文证据摘录

European Capital Goods: On The Road: China trip takeaways – 'K-shaped' trajectory

Barclays | European Capital Goods

manufacturing, electronics, etc) now a higher contributor to GDP/FAI than old economy

(property, infra, etc), 2) contribution to people's wealth is more balanced between property

and financial products now vs property-heavy before, 3) urbanisation has already passed the

peak stage, etc. Hence there have been a couple of changes in macro policy direction since

September 2024, e.g. 1) financial market policies are now at a similar level of importance as

fiscal/credit measures; 2) credit (which is more important for property/infra, etc) is less of an

indicator for the economy; 3) the government is more patient on monetary measures such as

interest rates and financial leverages if there is no asset bubble/systemic risk; 4) the

government now invests more in people than in property/infra.

• China sees less impact from energy inflation. China manufacturers see less impact from

higher oil prices (apart from more oil-driven players like refiners) compared with countries

such as Japan/S. Korea/Vietnam. These countries combined also account for a higher

proportion of global industrial value-added, so see a greater impact from inflation than

China, which also benefits from lower power prices. Mid-stream manufacturing/equipment-

makers see substantial global opportunities.

• Mid-stream manufacturing > consumption > infra. In the near term, consumption still

looks set to struggle as it is still taking time for policy support such as tax reform to have an

impact. Relatively speaking, mid-stream (e.g. equipment) manufacturing appears better

positioned than consumption, which in turn looks better placed than infra.

• Anti-involution to improve quality.