Welcome to Fidelity

Select a location so we can provide you with the appropriate information

Bienvenue chez Fidelity

Veuillez sélectionner un pays afin que nous vous communiquions l'information appropriée

Willkommen bei Fidelity

Wählen Sie Ihren Standort aus, damit wir Ihnen die für Sie passenden Informationen anzeigen können.

Benvenuti in Fidelity

Seleziona un paese in modo da consentirci di fornirti le informazioni appropriate

フィデリティのウェブサイトへようこそ

適切な情報を表示するため、現在お住まいの地域を選択してください。

Welcome to Fidelity

Select a location so we can provide you with the appropriate information

Willkommen bei Fidelity

Wählen Sie Ihren Standort aus, damit wir Ihnen die für Sie passenden Informationen anzeigen können.

Important information

I confirm that I am accessing this website for the purpose of acquiring information as, or for, an Institutional Investor (a corporate or other non-retail investor acting for their own account).

By accessing the restricted area I confirm my agreement with‚ and understanding of‚ the following terms of use and the legal provisions. If I do not agree to the terms and legal conditions‚ I must not access this website or any pages thereof. I acknowledge that access to the information contained on this website is available to "Qualified Investors" only as defined below. A private individual or legal representative or any other party without this qualification should not enter this website.

By accessing this website or any of its pages‚ I confirm that I am a qualified investor in accordance with Art 10.3 CISA.

The following are considered to be qualified investors:

  • supervised financial intermediaries such as banks, securities dealers‚ management companies and asset managers of collective investment schemes‚ as well as central banks;
  • supervised insurance companies;
  • public-law bodies and occupational pension institutions with professional treasury;
  • companies with professional treasury.

I understand the information contained in this website is not directed at, nor is it intended for distribution to, or use by, persons in any jurisdiction in which the dissemination of such investment related information is not permitted. I also understand that the information contained in this site is not directed to any party that may be defined as a ‘retail investor’ by the home regulator of the country in which the website is being accessed. I understand that the information or opinions contained herein should not be construed as an offer to sell or the solicitation of an offer to buy any investment product nor shall any such investment products or services be offered or sold to any person in any jurisdiction in which such offer, solicitation, purchase or sale would be unlawful. Fidelity has expressed its own views and opinions on this website, and these may change and there is no obligation to update them. Nothing in this website should be construed as investment, tax, legal or other advice. The information contained herein is subject to change without notice.

I understand the information contained in this website is not directed at, nor is it intended for distribution to, or use by, persons in any jurisdiction in which the dissemination of such investment related information is not permitted. I also understand that the information contained in this site is not directed to any party that may be defined as a ‘retail investor’ by the home regulator of the country in which the website is being accessed. I understand that the information or opinions contained herein should not be construed as an offer to sell or the solicitation of an offer to buy any investment product nor shall any such investment products or services be offered or sold to any person in any jurisdiction in which such offer, solicitation, purchase or sale would be unlawful. Fidelity has expressed its own views and opinions on this website, and these may change and there is no obligation to update them. Nothing in this website should be construed as investment, tax, legal or other advice. The information contained herein is subject to change without notice.

This website has been issued by FIL Fund Management Limited, a Bermuda company licensed to conduct investment business by the Bermuda Monetary Authority. Neither FIL Fund Management Limited, its parent company FIL Limited, nor any of their group companies or affiliates makes or gives any warranty or representation that any information contained on this website is accurate, complete, or fit for any particular purpose.

I acknowledge that neither FIL Fund Management Limited, FIL Limited, nor any of their group companies or affiliates will have any liability for any losses arising directly or indirectly from any information accessed from this website. By accepting this representation I also confirm my agreement to the website Terms and Conditions, which I have read and understood.

Fidelity International, the Fidelity International logo and F symbol are trademarks of FIL Limited, a company existing under the laws of Bermuda.

If the above representation is correct, please click 'I agree' below to continue to the site.

Information importante

Je confirme accéder à ce site Internet afin d’obtenir des informations en qualité d’investisseur institutionnel.

Je comprends que les informations contenues sur ce site Internet sont destinées exclusivement aux investisseurs résidant en France et ne doivent pas être diffusées à quiconque pouvant être considéré comme un investisseur particulier. Je comprends que les informations ou opinions présentées sur ce site ne constituent pas des recommandations d’achat ou de vente. Fidelity a exprimé ses propres vues et opinions sur ce site Internet, et celles-ci peuvent évoluer sans que Fidelity n’assume aucune obligation de les actualiser. Aucun élément de ce site Internet ne doit être interprété comme un avis d’investissement, fiscal ou juridique ou autre. Les informations que comporte ce site peuvent changer sans notification.

Ce site Internet est présenté par FIL Gestion, SGP agréée par l'AMF sous le n°GP03-004, 29 rue de Berri, 75008 Paris. Ni FIL Gestion, ni sa société mère FIL Limited, ni aucune des sociétés ou affiliées du groupe ne garantit ni ne fait aucune déclaration sur l’exactitude, l’exhaustivité ou l’adaptation à une finalité donnée des informations présentées sur ce site Internet.

Je reconnais que ni FIL Gestion, ni FIL Limited, ni aucune des sociétés ou affiliées du groupe n’assume une quelconque responsabilité au titre de toute perte découlant directement ou indirectement de toute information obtenue à partir de ce site Internet.

Ce site présentant des informations en langues française et anglaise, j’accepte de recevoir des informations non exclusivement rédigées en français.

Je confirme également, par l’acceptation de cette déclaration, mon accord sur les conditions et modalités du site Internet que j’ai lues et comprises.

Fidelity, Fidelity International, le logo Fidelity International ainsi que le symbole F sont des marques déposées de FIL Limited.

Si vous accepter les termes de la déclaration ci-dessus, veuillez cliquer sur « j’accepte » ci-dessous pour poursuivre votre navigation sur ce site.

Wichtige Informationen

Hiermit bestätige ich, dass ich diese Website zur Informationsbeschaffung als institutioneller Anleger (ein auf eigene Rechnung handelndes Unternehmen oder ein anderer nicht als Privatanleger geltender Investor) bzw. für einen institutionellen Anleger besuche.

Mit dem Zugriff auf den zugangsbeschränkten Bereich bestätige ich, dass ich die folgenden Nutzungsbedingungen und rechtlichen Klauseln verstanden habe und mit ihnen einverstanden bin. Andernfalls darf ich auf diese Website oder Teile davon nicht zugreifen. Mir ist bewusst, dass der Zugang zu den Informationen auf dieser Website nur für „qualifizierte Anleger“ gemäss untenstehender Definition vorgesehen ist. Eine Privatperson, ein rechtlicher Vertreter oder irgendeine andere Partei ohne diese Qualifikation sollte nicht auf diese Webseite zugreifen.

Mit dem Zugriff auf diese Website oder Teile davon bestätige ich, dass ich ein qualifizierter Investor gemäß Art 10 Absatz 3 des schweizerischen Bundesgesetzes über die kollektiven Kapitalanlagen bin.

Als qualifizierte Anlegerinnen und Anleger im Sinne dieses Gesetzes gelten:

  • beaufsichtigte Finanzintermediäre wie Banken, Effektenhändler, Fondsleitungen und Vermögensverwalter kollektiver Kapitalanlagen sowie Zentralbanken;
  • beaufsichtigte Versicherungseinrichtungen;
  • öffentlich-rechtliche Körperschaften und Vorsorgeeinrichtungen mit professioneller Tresorerie;
  • Unternehmen mit professioneller Tresorerie.

Mir ist bewusst, dass sich die Informationen auf dieser Website nicht an Personen richten bzw. für sie bestimmt sind, in deren Land die Verbreitung solcher anlagebezogenen Informationen nicht erlaubt ist. Mir ist bewusst, dass die hier zu findenden Informationen oder Meinungen nicht als Aufforderung zum Kauf oder Verkauf eines Anlageprodukts zu verstehen sind. Es sollen auch keine solchen Anlageprodukte oder Dienstleistungen Personen angeboten oder verkauft werden, in deren Land ein entsprechendes Angebot, eine Aufforderung, ein Erwerb oder Verkauf ungesetzlich wäre. Fidelity äußert auf dieser Website seine eigenen Ansichten und Meinungen, die sich jederzeit ändern können, ohne dass eine Verpflichtung zur Aktualisierung besteht. Kein Inhalt dieser Website ist als Beratung in Bezug auf Geldanlagen, Steuern, rechtliche oder sonstige Aspekte zu verstehen. Die hierin enthaltenen Informationen können sich ohne entsprechende Mitteilung jederzeit ändern.

Mir ist bewusst, dass sich die Informationen auf dieser Website nicht an Personen richten bzw. für sie bestimmt sind, in deren Land die Verbreitung solcher anlagebezogenen Informationen nicht erlaubt ist. Mir ist ebenfalls bewusst, dass sich die Informationen auf dieser Website nicht an Adressaten richtet, die von der Aufsichtsbehörde in dem Land, von dem aus die Website besucht wird, möglicherweise als „Privatanleger“ klassifiziert werden. Des Weiteren ist mir bewusst, dass die hier zu findenden Informationen oder Meinungen nicht als Aufforderung zum Kauf oder Verkauf eines Anlageprodukts zu verstehen sind. Es sollen auch keine solchen Anlageprodukte oder Dienstleistungen Personen angeboten oder verkauft werden, in deren Land ein entsprechendes Angebot, eine Aufforderung, ein Erwerb oder Verkauf ungesetzlich wäre. Fidelity äußert auf dieser Website seine eigenen Ansichten und Meinungen, die sich jederzeit ändern können, ohne dass eine Verpflichtung zur Aktualisierung besteht. Kein Inhalt dieser Website ist als Beratung in Bezug auf Geldanlagen, Steuern, rechtliche oder sonstige Aspekte zu verstehen. Die hierin enthaltenen Informationen können sich ohne entsprechende Mitteilung jederzeit ändern.

Diese Website wurde von FIL Fund Management Limited eingerichtet, einem Unternehmen mit Sitz auf bzw. nach dem Recht der Bermuda-Inseln, das über eine Genehmigung der Bermuda Monetary Authority zur Ausübung von Investmenttätigkeiten verfügt. Weder FIL Fund Management Limited noch sein Mutterunternehmen FIL Limited oder irgendein anderes Konzernunternehmen oder verbundenes Unternehmen übernimmt die Gewähr dafür oder erklärt, dass die Informationen auf dieser Website zutreffend, vollständig oder für jedwede Zwecke geeignet sind.

Ich erkenne an, dass weder FIL Fund Management Limited noch FIL Limited oder ein anderes Konzernunternehmen bzw. verbundenes Unternehmen für etwaige Verluste haftet, die direkt oder indirekt aus einer auf dieser Website beschafften Information resultieren. Durch Annahme dieser Erklärung bestätige ich auch mein Einverständnis mit den Nutzungs- und Geschäftsbedingungen dieser Website, die ich gelesen und verstanden habe.

Fidelity International, das Fidelity International Logo und das F-Symbol sind Markenzeichen von FIL Limited, einem nach dem Recht der Bermuda-Inseln eingetragenen Unternehmen.

Diese Website präsentiert Informationen in englischer und deutscher Sprache. Als professioneller Anleger akzeptiere ich hiermit, Informationen in mehr als einer Sprache zu erhalten.

Wenn die obige Erklärung zutrifft, klicken Sie bitte auf „Ich stimme zu“, um auf die Website zu gelangen.

Informazioni importanti

Confermo di voler accedere a questo sito web per acquisire informazioni in veste o per conto di un Investitore istituzionale (una società o altro investitore non retail che agisce per proprio conto).

Riconosco che le informazioni contenute in questo sito web non sono dirette né sono destinate alla distribuzione o all’uso da parte di soggetti in qualsiasi giurisdizione in cui la diffusione di tali informazioni relative allinvestimento non è consentita. Riconosco inoltre che le informazioni contenute in questo sito web non sono dirette a soggetti che potrebbero essere definiti "investitori retail" dall'autorità di vigilanza nazionale del paese dal quale si accede al sito stesso. Riconosco che le informazioni o le opinioni contenute in questo sito web non devono essere interpretate come un'offerta di vendita o come la sollecitazione di un'offerta di acquisto di un prodotto o un servizio di investimento, né tali prodotti o servizi di investimento possono essere offerti o venduti a soggetti di giurisdizioni nelle quali tale offerta, sollecitazione, acquisto o vendita sarebbero illegali. Questo sito web contiene giudizi e opinioni espressi da Fidelity, che sono soggetti a modifica e rispetto ai quali non sussiste alcun obbligo di aggiornamento. Nulla di quanto contenuto in questo sito web va considerato come una consulenza di investimento, fiscale, legale o di altra natura. Le informazioni qui riportate sono soggette a modifica senza preavviso.

Questo sito web è pubblicato da FIL Fund Management Limited (una società delle Bermuda autorizzata a svolgere attività d'investimento dalla Bermuda Monetary Authority). Né FIL Fund Management Limited, né la sua società madre FIL Limited, né alcuna delle loro società del gruppo o affiliate fornisce o rilascia alcuna garanzia o dichiarazione che le informazioni contenute in questo sito web siano accurate, complete o adatte a uno scopo particolare.

Riconosco che né FIL Fund Management Limited, né FIL Limited né alcuna delle loro società del gruppo o affiliate si assumono alcuna responsabilità per eventuali perdite derivanti direttamente o indirettamente da informazioni ottenute da questo sito web. Accettando questa dichiarazione confermo anche di aver letto, compreso e accettato i Termini e le condizioni d'uso del sito web.

Fidelity International, il logo Fidelity International e il simbolo F sono marchi di proprietà di FIL Limited, una società costituita nelle Bermuda.

Se la dichiarazione di cui sopra è corretta, cliccare "Accetto" qui sotto per continuare a visitare il sito.

重要な情報

私は、機関投資家(自己勘定取引を行う個人投資家以外の法人その他の投資家)として、あるいはかかる機関投資家のために、当ウェブサイトにアクセスし、情報を取得するものです。

私は、当ウェブサイトに掲載される情報は、かかる投資関連情報の流布が違反となる法域の人物に提供するものではなく、そういった人物によって拡散されたり利用されたりすることを意図したものでもないことを理解しています。また、当サイトに掲載される情報が、ウェブサイトにアクセスする場所の国の規制当局によって「個人投資家」と定義され得る人物に向けたものではなく、当サイトにある情報または意見は、何らかの投資商品の勧誘や募集と解釈すべきではなく、かかる投資商品またはサービスの募集、勧誘、売買が違法となる法域にいる人物に対して募集ないし販売されるものでもないことも理解しています。フィデリティは、当ウェブサイト上に自社の見解や意見を掲載していますが、これらは変わる可能性があり、そういった変更があった場合に当ウェブサイトを更新しなければならないという義務は負っていません。当ウェブサイトの内容はいずれも投資、税務、法務、その他の助言と解釈すべきではなく、ウェブサイト上の情報は通知なく変更される可能性があります。

当ウェブサイトはバミューダ籍の法人でバミューダ金融庁から投資事業免許を取得しているFILファンド・マネジメント・リミテッドが作成しています。FILファンド・マネジメント・リミテッド、その親会社であるFILリミテッド、またはそれらのグループ会社か関連会社のいずれも、当ウェブサイトに掲載される情報が正確であるとか、完全であるとか、特定の目的に適合したものである等の保証や表明は行っておらず、そういった保証や表明を提供することもありません。

FILファンド・マネジメント・リミテッド、FILリミテッド、またはそれらのグループ会社か関連会社のいずれもが、当ウェブサイトから入手した情報によって直接または間接的に発生した損失の責を負うものではないことに了承します。

フィデリティ・インターナショナル、フィデリティ・インターナショナルのロゴおよびFのシンボルはバミューダ法の下で設立された法人であるFILリミテッドの商標です。

以上をご確認いただける場合には、以下の「同意します」ボタンをクリックしてください。

Important information

I confirm that I am accessing this website for the purpose of acquiring information as, or for, an Institutional Investor (a corporate or other non-retail investor acting for their own account).

I understand the information contained in this website is not directed at, nor is it intended for distribution to, or use by, persons in any jurisdiction in which the dissemination of such investment related information is not permitted. I also understand that the information contained in this site is not directed to any party that may be defined as a ‘retail investor’ by the home regulator of the country in which the website is being accessed. I understand that the information or opinions contained herein should not be construed as an offer to sell or the solicitation of an offer to buy any investment product nor shall any such investment products or services be offered or sold to any person in any jurisdiction in which such offer, solicitation, purchase or sale would be unlawful. Fidelity has expressed its own views and opinions on this website, and these may change and there is no obligation to update them. Nothing in this website should be construed as investment, tax, legal or other advice. The information contained herein is subject to change without notice.

This website has been issued by FIL Fund Management Limited, a Bermuda company licensed to conduct investment business by the Bermuda Monetary Authority. Neither FIL Fund Management Limited, its parent company FIL Limited, nor any of their group companies or affiliates makes or gives any warranty or representation that any information contained on this website is accurate, complete, or fit for any particular purpose.

I acknowledge that neither FIL Fund Management Limited, FIL Limited, nor any of their group companies or affiliates will have any liability for any losses arising directly or indirectly from any information accessed from this website. By accepting this representation I also confirm my agreement to the website Terms and Conditions, which I have read and understood.

Please note that FIL Fund Management Limited is not licensed by the Liechtenstein Financial Market Authority (“FMA”) and is not subject to the supervision of the FMA.

Fidelity International, the Fidelity International logo and F symbol are trademarks of FIL Limited, a company existing under the laws of Bermuda.

If the above representation is correct, please click 'I agree' below to continue to the site.

Wichtige Informationen

Hiermit bestätige ich, dass ich diese Website zur Informationsbeschaffung als institutioneller Anleger (ein auf eigene Rechnung handelndes Unternehmen oder ein anderer nicht als Privatanleger geltender Investor) bzw. für einen institutionellen Anleger besuche.

Mir ist bewusst, dass sich die Informationen auf dieser Website nicht an Personen richten bzw. für sie bestimmt sind, in deren Land die Verbreitung solcher anlagebezogenen Informationen nicht erlaubt ist. Mir ist ebenfalls bewusst, dass sich die Informationen auf dieser Website nicht an Adressaten richtet, die von der Aufsichtsbehörde in dem Land, von dem aus die Website besucht wird, möglicherweise als „Privatanleger“ klassifiziert werden. Des Weiteren ist mir bewusst, dass die hier zu findenden Informationen oder Meinungen nicht als Aufforderung zum Kauf oder Verkauf eines Anlageprodukts zu verstehen sind. Es sollen auch keine solchen Anlageprodukte oder Dienstleistungen Personen angeboten oder verkauft werden, in deren Land ein entsprechendes Angebot, eine Aufforderung, ein Erwerb oder Verkauf ungesetzlich wäre. Fidelity äußert auf dieser Website seine eigenen Ansichten und Meinungen, die sich jederzeit ändern können, ohne dass eine Verpflichtung zur Aktualisierung besteht. Kein Inhalt dieser Website ist als Beratung in Bezug auf Geldanlagen, Steuern, rechtliche oder sonstige Aspekte zu verstehen. Die hierin enthaltenen Informationen können sich ohne entsprechende Mitteilung jederzeit ändern.

Diese Website wurde von FIL Fund Management Limited eingerichtet, einem Unternehmen mit Sitz auf bzw. nach dem Recht der Bermuda-Inseln, das über eine Genehmigung der Bermuda Monetary Authority zur Ausübung von Investmenttätigkeiten verfügt. Weder FIL Fund Management Limited noch sein Mutterunternehmen FIL Limited oder irgendein anderes Konzernunternehmen oder verbundenes Unternehmen übernimmt die Gewähr dafür oder erklärt, dass die Informationen auf dieser Website zutreffend, vollständig oder für jedwede Zwecke geeignet sind.

Ich erkenne an, dass weder FIL Fund Management Limited noch FIL Limited oder ein anderes Konzernunternehmen bzw. verbundenes Unternehmen für etwaige Verluste haftet, die direkt oder indirekt aus einer auf dieser Website beschafften Information resultieren. Durch Annahme dieser Erklärung bestätige ich auch mein Einverständnis mit den Nutzungs- und Geschäftsbedingungen dieser Website, die ich gelesen und verstanden habe.

Fidelity International, das Fidelity International Logo und das F-Symbol sind Markenzeichen von FIL Limited, einem nach dem Recht der Bermuda-Inseln eingetragenen Unternehmen.

Bitte beachten Sie, dass die FIL Fund Management Limited von der Finanzmarktaufsicht Liechtenstein weder zugelassen noch beaufsichtigt ist.

Diese Website präsentiert Informationen in englischer und deutscher Sprache. Als professioneller Anleger akzeptiere ich hiermit, Informationen in mehr als einer Sprache zu erhalten.

Wenn die obige Erklärung zutrifft, klicken Sie bitte auf „Ich stimme zu“, um auf die Website zu gelangen.

Please scroll down to read through all of the terms.
Merci de bien vouloir faire defiler ce message jusqu’à son terme.
Bitte scrollen Sie nach unten, um alle wichtigen Informationen durchzulesen.
Per favore scorri verso il basso per leggere tutte le condizioni.
スクロールダウンし、全ての注意事項をよくお読み下さい。
Please scroll down to read through all of the terms.
Bitte scrollen Sie nach unten, um alle wichtigen Informationen durchzulesen.

Delayed demand making its return to China’s property market

New home sales are recovering faster than expected in China. This has big implications for domestic demand and the macroeconomic outlook.

09 April 2020

People shop at a sales office in Huai'an City, Jiangsu Province, China, March 22, 2020. Photo by Costfoto/Barcroft Media via Getty Images.
Costfoto/Barcroft Media via Getty Images

The dream of home ownership is alive and well in China. While at the height of the coronavirus lockdowns in February, residential sales volumes in China’s major cities were down 90 per cent year-on-year, they have more recently recovered to around 30 per cent below normal levels. Housing demand that was pent up for months is now slowly starting to be released.

As the middle class grows and people seek better job opportunities and medical facilities, the long-term population growth of higher-tiered cities will likely continue. Companies are responding by turning their attention to cities like Shenzhen, Nanjing, and Hangzhou, where despite the Covid-19 outbreak, new project launches were recently sold out in half a day. There are signs some developers are acting to bet on the next upcycle. At recent land auctions in Chengdu and Beijing, developers paid high premiums over the starting bids. 

We expect higher tier cities to recover first, as their markets are performing much better than lower tier cities, which are doing price discounts of 20 to 30 per cent. Although large stimulus and a sharp upcycle is unlikely, marginally improving sector performance can be expected.

Economic reverberations

A rebound in property could benefit other parts of the economy. While its relative contribution has been declining over the years, property still accounts for roughly 7 per cent of China’s GDP, and 17 per cent when related investments are included. 

For example, China’s steel demand is the highest in the world, and property accounts for roughly a third of that. Steel demand has recently recovered to levels seen before the January Lunar New Year, but we think it’s mainly due to inventory restocking rather than construction activity, which will need to further rebound in the coming quarters to digest this new supply of the metal.  

Policy supportive but prudent 

So far, policy support has come at a measured pace, and will likely remain so. Small and medium sized companies and manufacturers will be favoured for new loans, as President Xi Jinping’s guideline of “houses are for living in, not for speculation” remains in place.

We have seen some incremental support measures which were targeted, mostly for the supply side. For banks, previous tight restrictions on the proportion of loans given to developers have been deemphasized to alleviate liquidity stress after the coronavirus outbreak. Rates on new mortgages have also been lowered slightly. We expect more demand side loosening to come on a city-by-city basis as the export slowdown intensifies.

Against the improving backdrop for the sector, we see little incentive for the government to unleash larger-scale easing measures (unless the outbreak worsens). There is low systemic risk around mortgages, despite the economic slowdown and rising unemployment. China’s household debt is relatively low at 56 per cent of GDP, and in the event of rising unemployment, mortgage repayments have less credit risk than things like credit cards and other consumer loans. 

Huge price dislocations create opportunities 

For investors, we see a supportive environment for China’s property sector stocks this year, based on expected prudent policy loosening to counter an exports slowdown amid the COVID-19 global pandemic. This, together with accelerated market consolidation, should let the winners in the sector grow their sales. While we expect nationwide sales should fall around 10 per cent this year, the stronger companies should be able to grow 5 to 10 per cent. 

“This environment favours strong, defensive state-owned developers that have abundant liquidity, high operating efficiency, low leverage, low financing cost, alternative land resources, and land banks which are focused on high-tier cities,” said Karen Zhou, equity analyst for China property.  

At the same time, valuations in the bond market are starting to look attractive. Chinese real estate developers make up about half of the Asian high yield universe. And year-to-date, China property high yields have risen by 500 basis points on average for credits rated BB, and 700 basis points for Bs, as global liquidity dried up and caused significant price dislocations. 

Discounted versus fundamentals

By contrast, in the China onshore market, property bonds have been trading at historically tight levels. This means there are huge yield differentials between onshore and offshore, even from the same issuer, which could signal a rare opportunity for investors. We recently saw onshore/offshore differentials of around 500 basis points for a high-quality BB-rated issuer, and 1300 basis points further down the credit curve, albeit these gaps have since narrowed a bit. 

Meanwhile, from an issuers’ perspective, developers may use the low-cost funding environment onshore to replenish their liquidity reserves, which should ease concerns for offshore bondholders. 

“For the rest of this year, offshore maturity is pretty much pre-funded, onshore funding access is improving, and policy remains supportive,” said Ming Gong, credit analyst for China property. “Based on the fundamentals, current valuations provide attractive opportunities.” 

In general, we see the sector as neither overly-leveraged nor at risk of widespread defaults. In both the onshore and offshore markets, quotas for incremental fund-raising have been strictly regulated in recent years in line with China’s deleveraging campaign. 

Another supportive catalyst are bond buybacks by the companies themselves, which signal abundant liquidity and a faith in the market’s fundamentals. Several issuers have already announced bond buybacks, and more are likely to come. These have been mostly in short-term debt, where the issuer can buy back their bonds at a discount and book a profit now, rather than repay at full value a few months later.

The key risks to watch include extended COVID-19 outbreaks in other countries, or a second wave in China that requires more lockdowns. Also, there can be a lag in policy response given the leadership’s cautious tone towards the property sector. If policy loosening does not come as expected, the fundamentals may slump again.  

Despite the macro challenges, there are still plenty of opportunities for developers with strong balance sheets, access to low-cost funding, high operating efficiency, and a focus on higher-tier cities. In the coming months, we’re likely to see a normalisation of pent-up demand that could help such companies outperform. 

This document is for Investment Professionals only and should not be relied on by private investors.

This document is provided for information purposes only and is intended only for the person or entity to which it is sent. It must not be reproduced or circulated to any other party without prior permission of Fidelity.

This document does not constitute a distribution, an offer or solicitation to engage the investment management services of Fidelity, or an offer to buy or sell or the solicitation of any offer to buy or sell any securities in any jurisdiction or country where such distribution or offer is not authorised or would be contrary to local laws or regulations. Fidelity makes no representations that the contents are appropriate for use in all locations or that the transactions or services discussed are available or appropriate for sale or use in all jurisdictions or countries or by all investors or counterparties.

This communication is not directed at, and must not be acted on by persons inside the United States and is otherwise only directed at persons residing in jurisdictions where the relevant funds are authorised for distribution or where no such authorisation is required. Fidelity is not authorised to manage or distribute investment funds or products in, or to provide investment management or advisory services to persons resident in, mainland China. All persons and entities accessing the information do so on their own initiative and are responsible for compliance with applicable local laws and regulations and should consult their professional advisers.

Reference in this document to specific securities should not be interpreted as a recommendation to buy or sell these securities, but is included for the purposes of illustration only. Investors should also note that the views expressed may no longer be current and may have already been acted upon by Fidelity. The research and analysis used in this documentation is gathered by Fidelity for its use as an investment manager and may have already been acted upon for its own purposes. This material was created by Fidelity International.

Past performance is not a reliable indicator of future results.

This document may contain materials from third-parties which are supplied by companies that are not affiliated with any Fidelity entity (Third-Party Content). Fidelity has not been involved in the preparation, adoption or editing of such third-party materials and does not explicitly or implicitly endorse or approve such content.

Fidelity International refers to the group of companies which form the global investment management organization that provides products and services in designated jurisdictions outside of North America Fidelity, Fidelity International, the Fidelity International logo and F symbol are trademarks of FIL Limited. Fidelity only offers information on products and services and does not provide investment advice based on individual circumstances.

Issued in Europe: Issued by FIL Investments International (FCA registered number 122170) a firm authorised and regulated by the Financial Conduct Authority, FIL (Luxembourg) S.A., authorised and supervised by the CSSF (Commission de Surveillance du Secteur Financier) and FIL Investment Switzerland AG. For German wholesale clients issued by FIL Investment Services GmbH, Kastanienhöhe 1, 61476 Kronberg im Taunus. For German Institutional clients issued by FIL (Luxembourg) S.A., 2a, rue Albert Borschette BP 2174 L-1021 Luxembourg.

In Hong Kong, this document is issued by FIL Investment Management (Hong Kong) Limited and it has not been reviewed by the Securities and Future Commission. FIL Investment Management (Singapore) Limited (Co. Reg. No: 199006300E) is the legal representative of Fidelity International in Singapore. FIL Asset Management (Korea) Limited is the legal representative of Fidelity International in Korea. In Taiwan, Independently operated by FIL Securities (Taiwan ) Limited, 11F, 68 Zhongxiao East Road., Section 5, Xinyi Dist., Taipei City, Taiwan 11065, R.O.C Customer Service Number: 0800-00-9911#2 .

Issued in Australia by Fidelity Responsible Entity (Australia) Limited ABN 33 148 059 009, AFSL No. 409340 (“Fidelity Australia”). This material has not been prepared specifically for Australian investors and may contain information which is not prepared in accordance with Australian law.

ED20 - 112