Key takeaways

• The National People’s Congress has laid out a pragmatic and supportive economic agenda for 2026, anchored by a GDP growth target of 4.5%-5.0% and sustained policy accommodation. The strategic focus is on boosting domestic demand through consumption subsidies, service sector support, structural fiscal reforms and doubling down on technology.
• The escalating Middle East conflict introduces a tangible external risk, primarily through potential disruption to energy and petrochemical supply chains. As the region is a critical supplier of industrial feedstocks, a prolonged conflict would cascade through downstream industries and accelerate sectoral consolidation. However, the inflationary pass-through to consumers is expected to remain muted.
• We remain overweight on Chinese equities, focusing on innovation champions and high-quality dividend stocks through our barbell approach. This allows investors to participate in China’s structural growth stories while anchoring portfolios with durable income. The offshore Chinese equity market is more sensitive to global factors, including geopolitical uncertainties. Valuations have become more attractive after the recent weakness.

Please refer to the full report for details about the event and our investment view.

“Overweight” implies a positive tilt towards the asset class, within the context of a well-diversified, typically multi-asset portfolio.

“Underweight” implies a negative tilt towards the asset class, within the context of a well-diversified, typically multi-asset portfolio.

“Neutral” implies neither a particularly negative nor a positive tilt towards the asset class, within the context of a well-diversified, typically multi-asset portfolio.

https://www.hsbc.com.my/wealth/insights/market-outlook/special-coverage/china-forges-its-economic-agenda-at-npc-while-uncertainty-continues-over-the-middle-east/