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Business Times
2 hours ago
- Business
- Business Times
Chinese economy stays challenged but some consumer stocks offer potential: BOA
[SINGAPORE] While headwinds persist for the Chinese economy and consumer confidence stays low, a select range of stocks could defy broader market trends and outperform their peers, said the Bank of America (BOA). Despite improved market sentiment, the Chinese economy remains saddled by challenged consumption growth and elevated youth unemployment alongside deflationary pressures, BOA analysts noted in a report last Thursday (May 29). However, stocks related to five themes could benefit from Chinese consumer spending, the BOA analysts said. Specifically, these are stocks that focus on the categories of health and wellness; affordable luxury; pragmatic goods and services; personal experiences and emotional value; as well as intellectual property. These 'new consumption' stocks display 'significant divergence in performance' amid softer market trends and sharply outperformed their peers in earnings growth and share prices, BOA analysts said. With clear value propositions – be it emotional value, functionality or affordability – these stocks are favoured over large-cap premium brands or market proxy players, they added. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Energy drinks, outdoor brands win on post-pandemic health, wellness focus An increased interest in health and wellness among Chinese consumers post Covid-19, has benefitted stocks focusing on these themes, BOA said. In the beverage market, energy drinks and soft drinks that focus on health and anxiety alleviation logged stronger sales growth compared to liquor or beer, the analysts noted. Outdoor brands including Amer Sports enjoyed nearly 40 per cent year-on-year growth compared to the overall domestic sportswear market, which logged sales growth only in the single-digit percentages. Online healthcare experienced 'rapid growth' fuelled by rising demand for proactive and preventive health management, and the increasing penetration of online drug purchasing. Affordable luxury gains amid deflationary environment Consumers tend to be price sensitive in deflationary environments. Within the passenger vehicle market, domestic brands nearly doubled their market share from 33 per cent in 2020 to 65 per cent in the first four months of 2025, thanks to better price-performance than European and Japanese brands, the report said. With improved product offerings, local brands in the smartphone market such as Xiaomi and Huawei have taken market share away from Apple. This trend towards affordability is reflected in travel, where short-haul and domestic trips via railways and budget airlines have been on the rise; and domestic, 'affordable luxury' hotel chains have wrestled market share away from global five-star hotels. Policy stimulus, subsidies boost demand for pragmatic items The analysts also observed an increased focus on the utility and functionality over brand names among consumers. Boosted by policy stimulus, sales for home appliances, furniture and consumer electronics rose by 20 to 25 per cent year-on-year for the first four months of 2025, outpacing overall retail sales growth, they noted. Mass market brands such as Geely, Leapmotor and XPeng are expected to outperform premium/luxury brands including Zeekr, Li Auto and Nio. Consumer willingness to spend on experiences The analysts noted that consumers are willing to invest time and money in experiences. Consumers are travelling more albeit spending less and treating themselves to 'small delights' such as new snacks, online games, cosmetics and pets. Companies such as Tencent and NetEase posted gaming revenue growth for Q1 2025. Meanwhile, Chinese snackmaker Yankershop reported 76 per cent year-on-year growth in 2024, significantly higher than that of the overall snack industry, thanks to its innovative konjac products. Co-branded products get boost from consumer spend on intellectual property BOA analysts highlighted that consumer spending on intellectual property-related goods and services – such as Labubu toys or domestic movies like Ne Zha – drives up sales for co-branded products. For instance, Pop Mart's retail sales rose by 165 to 170 per cent for Q1 of 2025, with China sales up by 95 to 100 per cent. The success of the animated movie Ne Zha 2, which contributed to around 60 per cent of China's Q1 2025 box office, also drove sales of co-branded products such as milk, teas and toys.
CNBC
2 hours ago
- Business
- CNBC
These stocks could benefit if interest rates break out higher
A handful of stocks may be well positioned to benefit from rising Treasury yields, according to Bank of America. Both the benchmark 10-year and 30-year Treasury have climbed recently to reach worrisome milestones. The 10-year yield was last at about 4.43%, just shy of the key 4.5% level, and up from 4.01% in early April. The yield on the 30-year bond stands just under 5%, also a key level that's drawn investor attention, and up from 4.41% when President Trump unveiled sharply higher tariffs on imported goods. The rise in Treasury yields largely reflects investor concern tied to the health of the U.S. economy, the size of the government debt and the state of the dollar. When the Court of International Trade on Wednesday struck down most of President Donald Trump's tariffs, the White House immediately appealed the decision, saying "it is not for unelected judges to decide how to properly address a national emergency." The ruling was stayed the next day by an appeals court, leaving investors continuing to question the direction of U.S. trade policy. Yet, despite all the confusion, investor appetite for risk assets has grown in the past two months , while demand for Treasury debt has waned. Against this backdrop, Bank of America looked for stocks that outperform the S & P 500 the most when 10-year Treasury note yields rise, measuring performance against month-over-month changes in the 10-year yield since 2014. Financials dominate the screen, accounting for six of the top 10 spots. Here's a look at the names that floated to the top of BofA's model. Prudential Financial snagged the top spot on the list with a 48% correlation to changes in the 10-year yield. Stock in the insurance and retirement planning giant has pulled back more than 12% so far in 2025. Its dividend yields 5.2%. PRU YTD mountain Prudential Financial stock in 2025. Nearly two thirds of analysts maintain a hold rating on Prudential stock, with their consensus price target implying 9% upside. Prudential beat Wall Street analysts earnings estimates when it reported first-quarter results in late April. JPMorgan Chase also made the cut. The bank yields 2.1% and shares have added more than 10% so far in 2025, while the S & P 500 has risen less than 1%. What's more is the bank's 35% correlation to changes in the 10-year yield. CEO Jamie Dimon has warned more than once this year that the economy could be headed for a recession, but JPMorgan Chase has outperformed, recently reporting first-quarter results that topped analyst estimates, fueled by strong profits from its trading desk. JPM YTD mountain JPMorgan Chase shares in 2025. Roughly 59% of analysts surveyed by FactSet rate JPMorgan Chase a buy, with the consensus price target implying a little more than 3% upside. Other names on the list include Charles Schwab and MetLife .
CBS News
2 hours ago
- Business
- CBS News
Runners from across the country to partake in Bank of America 13.1 Half Marathon in Garfield Park
Thousands of runners are gearing up for the fourth annual Bank of America Half 13.1 Marathon on Sunday morning on Chicago's West Side. Those taking part will give it their all as they put feet to pavement in Garfield Park. The marathon draws people from all over the city, state, and country. Last year, some international participants participated. Runners will have a unique experience of the city's West Side neighborhoods. The course weaves through our historic parks and boulevards, starting and finishing in Garfield Park with some scenic loops through Humboldt and Douglass Parks. Organizers say their goal is to support and advance health and wellness on Chicago's west side, with a chance to showcase local businesses on the city's West Side. Map of the Bank of America 13.1 Marathon Runners will head south on Independence to Douglass Park and then back up through Jackson, eventually up Sacramento to Humboldt Park. The race kicks off at 7 a.m. with a Race Day Festival to follow at 8 a.m.
Forbes
11 hours ago
- Business
- Forbes
Housing Market Uncertainty Reaches 3-Year High, BofA Report Finds
Homeowners and buyers are cautiously optimistic. getty Both homeowners and prospective buyers find the current housing market unpredictable. In fact, 60% of both groups don't know if this is a good time to buy a house, according to a new Bank of America report, which notes this is a 3-year high. However, 52% of those looking for a new home express optimism, and believe the housing market is better than it was last year. Matt Vernon, head of consumer lending at Bank of America, provides insight from the report. According to the report, 60% of homeowners and prospective buyers can't tell whether it's a good time to buy a house of not. This is up 3 percentage points from 2024, and 12 percentage points from 2023. However, the majority of prospective buyers are optimistic. In fact, 75% expect both prices and interest rates to fall, and they're waiting until then to purchase a new home. This is compared to 67% who felt this way in 2024, and 62% who held this view in 2023. 'Housing affordability is definitely a concern, but I think both housing experts and prospective homebuyers see things heading in the right direction,' Vernon says. While the market still needs to improve, he says the report shows that buyers are still optimistic, and believe things are better now than they were a year ago. 'As new market data emerges, we're seeing more inventory (although delistings have also increased) and a slight cooling in price growth, which could give buyers more breathing room,' Vernon explains. 'So, while it's still a tough market, there's a sense that the tide might be starting to turn.' In spite of any financial obstacles, Gen Z is committed to homeownership – as well as the sacrifices that may be necessary to achieve this goal. In fact, 30% of Gen Z homeowners said they took an extra job to get the money for a down payment. This is up from 28% in 2024, and 24% in 2023. Some Gen Z homeowners are also open to living with other people in order to reach their homeownership goal. In fact, 22% of Gen Z homeowners reported that they purchased their home with siblings, compared to 12% in 2024, and 4% in 2023. The report also found that 34% of Gen Z prospective homebuyers would consider living with family or friends while waiting to purchase a home. This generation is also open to receiving help to purchase a home. The report reveals that 21% of Gen Z prospective homebuyers plan to get a loan from parents or other family members for the down payment, compared to just 15% of the general population who say the same. Among all prospective homebuyers, this number is up from 12% in 2024 and 9% in 2023. Last year, weather-related home losses reached record levels This increase in severe weather events did not go unnoticed by homeowners and prospective buyers. The report reveals that 62% of both groups are concerned about the impact of severe weather and natural disasters as it relates to homeownership. Also, 73% believe it's important to purchase in areas with a lower risk of these events occurring. The report reveals that 38% of survey respondents have changed the location of their preferred home purchasing location based on that area's risk of severe weather. Also, 23% of current homeowners say they have experienced property damage or loss in the last 5 years. due to severe weather events, and 65% of current homeowners report taking measures to prepare their home for the risk of severe weather. If you plan to purchase a home, Vernon recommends that you start preparing early—even if you're not ready yet. 'This market can be unpredictable, but the more prepared you are, the more confident you'll feel when the right opportunity comes along,' he says. So, what does this entail? 'Get a handle on your credit, build a savings cushion, and understand what you can realistically afford,' Vernon suggests. In addition, he says you shouldn't underestimate the power of getting preapproved, as it can make a huge difference when you're ready to make an offer. 'A lot of buyers right now are waiting for rates or prices to come down, but in the meantime, use this time to strengthen your financial foundation so you're ready to act when the timing feels right,' Vernon concludes. If you're a homeowner, check out these 5 home renovation trends in a sell'ers market. Read the full Bank of America 2025 Homebuyer Insights Report here.
Yahoo
a day ago
- Business
- Yahoo
Japan's warning, the trade war's next phase, and Trump Media's Bitcoin buy: Markets news roundup
Demand for Japan's 40-year government bonds plunged Wednesday to its lowest level since last July, reinforcing fears that appetite for ultra-long Japanese debt is evaporating. Read More Stocks opened higher Thursday morning after a federal court struck down most of President Donald Trump's 'Liberation Day' tariffs, fueling early optimism that one of 2025's biggest economic headwinds could be moving into the rearview. Read More The U.S. housing market has undergone an unprecedented shift: Sellers now outnumber buyers by approximately 490,000. It's the largest disparity since Redfin, a real estate company, began tracking the data in 2013. Redfin's report, published Thursday, forecasts that if current trends persist, home prices could decline by 1% by the end of 2025, on average. 'Prospective buyers may see their purchasing power increase, and prospective sellers should consider selling sooner rather than later,' the report states. Read More Trump Media & Technology Group has tapped investors for $2.5 billion to fund a cryptocurrency reserve. Institutional investors have bought shares in the firm under a private placement, the Trump family's media company announced Tuesday, with the proceeds set to be invested in Bitcoin. Read More Uncertainty among homeowners and buyers is at a three-year high, according to Bank of America's (BAC) Homebuyer Insights Report published Wednesday. Of the survey's 2,000 respondents nationwide, 60% said they are unsure whether now is a good time to buy, compared to 48% in 2023. Despite this, about half of the prospective homebuyers surveyed feel optimistic about the market, saying it's improved over the past year. Respondents expect this to continue: 75% foresee home prices and interest rates falling, and are waiting until then to buy a new home. That's up from 62% in 2023. Read More Shein appears to be abandoning its hopes for a flotation in London. The fast-fashion retailer is reportedly preparing to list on the Hong Kong stock exchange as its application to launch an initial public offering on the London Stock Exchange stalls with Chinese regulators, Reuters reported Wednesday. While Shein is headquartered in Singapore, it was founded in China, where the majority of its suppliers remain. Read More Consumers' attitudes about the U.S. economy improved in April as trade tensions eased. The latest survey of consumers from the Conference Board released on Tuesday indicated consumer confidence was rebounding, breaking a five-month slump. It leapt to a score of 98 in April compared to 85.7 a month earlier, sharply overtaking economists' expectations. (A score of 100 equals the benchmark score for 1985.) The gains in consumer confidence was spread out among all income and age groups, the Conference Board said. Read More Treasury yields fell on Tuesday with bond markets a little more reassured that a new front in the trade war won't be opened in the near future. The thirty-year Treasury yield dropped five basis points to 4.984% as stock futures surged. Meanwhile, the ten-year Treasury yield had shed four basis points to 4.475% at the time of publication. Read More International growth is slowing, fewer new jobs will be created, and the global income gap is rising — largely because of elevated trade tension spearheaded by U.S. President Donald Trump. That's according to the International Labour Organization (ILO), a UN agency, whose new report is based on the IMF's April 2025 'World Economic Outlook.' The IMF also singled out new tariffs and a 'highly unpredictable environment.' Read More U.S. stocks rose sharply Tuesday, with the S&P 500 climbing over 2%, the Nasdaq gaining 2.5%, and the Dow Jones Industrial Average rising 740 points, or 1.8%, in a rebound from last week's selloff. Read More For the latest news, Facebook, Twitter and Instagram. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
