Gifting is an important concept in China, especially within the political sphere. Some of the country’s largest retailers are expecting a boost to sales as the government goes through a once-in-a-decade transition of leadership this month. Pent-up demand and the hope to curry favor with new administration officials is expected to increase sales in the fourth quarter and by 10% next year.
Some observers are welcoming China’s shrinking trade surplus as a sign the country is finally rebalancing its economy to move away from export dependence and consume more imports. But China’s imbalances have actually worsened.
While we are watching the impact of slowing Chinese growth forecasts on aluminum stocks today, the impact on luxury retail in Chinese cities seems negligible so far. Plus: Boeing and oil prices.
Despite rumors that Hong Kong retail investors are nervous about grabbing too many shares of Prada and having to pay Italian taxes, institutional accounts are loving the space.