A Strong Asian Economy Will Keep Our Market Bubbling in 2018

I like to keep my eye on the Singapore stock exchange.

That’s because a lot of Asian property developers are listed there. And it tells you a lot about all the development that’s going on in the Asian region.

It’s a great way to gauge how the economy is faring.

Over the past few years, property developers in Asia have been very busy.

It shows no signs of slowing down, either, if recent news from the Singapore exchange is any guide.

Here are a couple of items from Singapore exchange that show you what’s going on in the region.

Firstly, listed property developer Keppel Corporation. Keppel just purchased two prime land sites in Ho Chi Minh city.

The two projects will add to Keppel Land’s pipeline of more than 20,000 homes in Vietnam.

Keppel Land CEO Ang Wee Gee said,

Vietnam’s housing demand is expected to continue its upward momentum, supported by the country’s young population, growing middle class as well as rising urbanisation. We are confident that these two developments will be well sought after, given the limited supply of upper middle-end gated landed homes and condominiums close to Ho Chi Minh city’s CBD.

Well a CEO would say that of course — he is after all probably the chief salesperson for the company. But nevertheless — young population, growing middle-class, rising urbanisation — that just about sums up Asia if you ask me.

I’ve travelled through Southeast Asia quite a bit, and got to see firsthand what is going on. There are lots of development going on and the whole region is buzzing.

Here’s news from another Singapore listed property developer, Perennial Real Estate Holdings.

They’re making major inroads into China. China’s population, which is fast ageing and growing in affluence, has a growing demand for quality healthcare facilities.

The Singapore developer will build healthcare developments connected around China’s high-speed railway stations. Think specialised hospitals, diagnostic centres and pharmacies. Having the developments near high speed rail stations helps support China’s Belt and Road initiative, and the growth of medical tourism in China.

The developments are expected to comprise other real-estate components such as hotels, retail, serviced apartments and offices.

China is building a lot of stations, and this is where people are. And it needs developments like this to house them and service them with healthcare facilities.

This type of building could go on almost forever. By the time it’s done, it will be time to demolish the old ones and build anew. 

The Asian economies are booming

These types of news items only confirm what I’m seeing in the charts.

When I do my scan of the markets, looking for charts breaking higher, a whole lot of Asian-focused exchange traded funds and listed investment companies are always popping up.

Asian economies are powering along, if the charts are any guide.

Asia is the largest region on the planet in terms of size and population, so what happens in Asia matters to our market here in Australia.

And Asia is booming — the charts clearly show it. Expect to read bullish reports in the press about the Asian region over the next few months or so.

It’s very bullish for the entire region, of which Australia is a part.

Whilst Asia is powering along like this, markets are most unlikely to collapse. Especially not within the next six months or so.

With Asia being so busy, you might expect a drive in demand for raw materials.

A strong Asia should keep the ASX bubbling throughout 2018, providing plenty of trading opportunities, especially in resource type stocks.

At Money Morning Trader we use the charts to trade some of these moves for profit. Go here to find out more.

Terence Duffy,
Editor, Money Morning Trader

Terence Duffy is an analyst and chartist, specialising in researching economic trends and cycles.  His primary focus is housing and land affordability. But you can also depend on him to offer his unique analysis of stock market charts. As Terence will show you, the charts often forecast, well in advance, the good or bad news to come.

Money Morning Australia