Asia-Pacific Market Weekly Report: Risk aversion spreads, and fundamentals and funding deviate seriously (Goldman Sachs)

2026-07-19·ima-daily5min-0719-20-48215ee9c7

Street Signal | Asia-Pacific Market Weekly Report: Risk aversion spreads, and fundamentals and funding deviate seriously (Goldman Sachs)

Goldman Sachs' Asia-Pacific weekly report showed that the MSCI Asia-Pacific (excluding Japan) index (MXAPJ) fell 4%, mainly affected by risk aversion in North Asia and the technology sector, escalating tensions between the United States and Iran, and mixed Chinese data. Despite the resilience of corporate earnings, foreign capital continues to flow out.

South Korea has introduced a ban on leveraged ETFs, and related risks have increased. The report gives configuration suggestions for each market and sector.

The market is generally concerned about global macro risks, but the report pointed out that corporate profits in the Asia-Pacific region (especially China) have not deteriorated, and the market's decline is more caused by sentiment and capital flows, forming a clear deviation.

One-sentence conclusion: The current decline in the Asia-Pacific market is mainly driven by external macro risks (geopolitics, US-Iran conflict) and capital flows (foreign capital outflows), rather than deterioration in corporate fundamentals. This departure creates opportunities for value investors.

Positive/negative: In the short term, it is negative for the overall Asia-Pacific market, but positive for defensive sectors (such as energy, telecommunications) and markets with strong profit growth certainty (such as India, Singapore). The market has partially priced in the risks, but sentiment recovery will take time. Catalysts:

1) The evolution of U.S.-Iran tensions;

2) Policy signals from China’s July Politburo meeting;

3) Interest rate decisions from major central banks (Federal Reserve, Bank of Japan).

Full text

Asia-Pacific Market Weekly Report: Risk aversion spreads, and fundamentals and funding deviate seriously (Goldman Sachs)

Goldman Sachs' Asia-Pacific weekly report showed that the MSCI Asia-Pacific (excluding Japan) index (MXAPJ) fell 4%, mainly affected by risk aversion in North Asia and the technology sector, escalating tensions between the United States and Iran, and mixed Chinese data. Despite the resilience of corporate earnings, foreign capital continues to flow out. South Korea has introduced a ban on leveraged ETFs, and related risks have increased. The report gives configuration suggestions for each market and sector. The market is generally concerned about global macro risks, but the report pointed out that corporate profits in the Asia-Pacific region (especially China) have not deteriorated, and the market's decline is more caused by sentiment and capital flows, forming a clear deviation. One-sentence conclusion: The current decline in the Asia-Pacific market is mainly driven by external macro risks (geopolitics, US-Iran conflict) and capital flows (foreign capital outflows), rather than deterioration in corporate fundamentals. This departure creates opportunities for value investors. Positive/negative: In the short term, it is negative for the overall Asia-Pacific market, but positive for defensive sectors (such as energy, telecommunications) and markets with strong profit growth certainty (such as India, Singapore). The market has partially priced in the risks, but sentiment recovery will take time. Catalysts: 1) The evolution of U.S.-Iran tensions; 2) Policy signals from China’s July Politburo meeting; 3) Interest rate decisions from major central banks (Federal Reserve, Bank of Japan).