00:00We want to talk a bit about how perhaps as investors look for other ways into frontier
00:05technology. It's not just about AI, it's about robotics as well, which I'm sure you have a lot
00:09to say on. But talk to us about this macro backdrop when inflation seems to be really
00:16hitting stocks, even in Asia, perhaps not so much for South Korea today. Do you see more to come
00:22on that front in terms of the risks? Hey, Avril, thanks for having me on. Certainly,
00:32yes, behind me is our ongoing EV and mobility conference. We'll come back to that. Sure,
00:41the backdrop around the world is focused on inflation. Clients are very focused on inflation
00:47and fiscal challenges as a secondary concern. And yes, you can see that playing out here in Asia.
00:56It's a different story, though, in some regards, I think, across Asia, where particularly in China,
01:06some of that inflationary concern is a little less negative than it is perhaps in other parts of the
01:14world. So I agree. We're certainly seeing, for example, following the CPI numbers in New York
01:19last week, we saw bond yields slipping further wider. Also in Japan, as you've highlighted,
01:27I think there's less pressure in region. And I think certainly as we look towards China,
01:34a little less pressure than we might expect in other parts of the world.
01:40Do you think that expectations for hotter inflation are sort of taking hold right now,
01:45Brian? I'm just wondering, there's higher yields. Are we at this new range that's here to stay? Or do
01:50you think that what we're seeing in inflation is still short-lived and we can get by once the
01:56straight-up from Israel? It's hard to imagine that inflationary pressures are going to be short-lived
02:08anywhere. Obviously, the longer the closure persists in the Middle East, those inflationary pressures are
02:16going to persist. And as you've mentioned, they're having an impact on global markets. They're having an
02:24impact here in region. And I would imagine that we're going to be talking about inflationary
02:31pressures, pressure on regional currencies, pressures on various market bond yields. I think
02:38that we're going to be talking about them for some time. It's tough to say how long the current impasse
02:46will last in the Middle East. But for sure, as long as that's looking less likely to resolve than
02:53more, we're going to be talking about inflation and the pressure on bond yields. No question.
03:00Brian, it's coming at a time where investors are banking on this structural shift in stock markets
03:07via AI trades. And as we were alluding to a short while ago, they're looking to broaden out
03:12in terms of, say, EVs as well on robotics, frontier technologies. Is there a read-through from inflation
03:20for those sectors? Or do you think the structural trends will overtake?
03:29Avril, I'm not going to necessarily talk about the longer-term structural trends specifically,
03:36but I am going to tell you that behind me, we've 400 investors, many of whom come from the region,
03:44but just as many have come from outside the region, traveled here to talk about the EV, mobility,
03:51robotics, sustainable energy sector. That's the business that we're talking to behind us.
03:58And clearly, clients are interested in that space. They're clearly looking to invest in that space.
04:06And if you think about it, an energy crisis, or at least an energy impasse, such as we see persisting
04:13in Hamos, is the perfect backdrop for clients to come and learn a little bit more about alternative energy sources
04:22and alternative renewables. And that's at a time when, obviously, that's more important.
04:30And it's also true that this part of the world, and certainly China, not just China, but this part of
04:36the world,
04:37is a recognized provider at the cutting edge of these technologies.
04:41So I don't think it's a surprise that clients would be joining us here today.
04:45I don't think it's a surprise that investors are interested in hearing more about that story
04:51at a time when the traditional energy sector looks very, very challenged.
04:55So if that's an indication of the sort of appetite for structural change that you reference,
05:02I think the turnout that we have today and the topics that we're discussing on the main stage,
05:07they seem to be very, very front and center for our clients' minds.
05:11Ryan, we've talked about foreign investors have started to sell out, or at least net selling,
05:16when it comes to markets like Taiwan, like Korea, some of these hardware sort of names within the AI space.
05:23How are investors that you're talking to, how are they repositioning around not just this AI revolution,
05:28but also around the whole renewable space now?
05:36Clients are interested to add.
05:39And the interest that we're seeing here today is on the buy side of that equation, I think.
05:49The region is very strong in offering investment opportunities in that space, again, particularly China, but not only.
06:01And again, the backdrop of the current situation in the Middle East seems to be providing an accelerant to clients
06:10that are interested.
06:10You know, the market here in Hong Kong has offered clients an opportunity to invest in those names.
06:20Very recently, we've seen a deal from Sig Energy, as you would know, that performed very, very well.
06:26The debt capital market pipeline seems to be very robust here in the region.
06:35And there's a lot of opportunity, I think, for clients to look at acquiring further in that space.
06:45It seems to be quite robust.
06:46The interest seems to be pretty high.
06:49On that front, you've just outlined some of the outlook for ECM.
06:54Is there a particular part of the EV supply chain that you think investors or you're advising investors to focus
07:01a bit more on?
07:05Well, we're here talking about the whole spectrum and our agendas covering everything from batteries to OEMs to the components
07:20and even the robotics elements of that landscape.
07:24We've robots wandering around behind me shaking hands with clients, and it's incredible how fast the agility of those robotics
07:33has come on in the last few years.
07:37So the whole sector seems to be benefiting from the backdrop in the Middle East, to be honest.
07:44And it's also true that China, as a market, offers, I think, a lot of diversification.
07:51So clients can look at the market through China and really find diversification that isn't necessarily always available in every
08:01other part of the region.
08:03So I do think there's a recognition that the market is deep there.
08:08There's an opportunity for true diversification, and you can look at any of those sectors that you're interested in and
08:17find a way to play that whole segment.
08:21What about when it comes to debt capital markets, especially given what we're seeing in the bond markets?
08:27Is that the same or similar assessment that you have on the trajectory?
08:35I think the debt capital market proposition in Asia is relatively stable when compared to the rest of the world.
08:45So although you highlight slipping yields and although you highlight the inflationary consequence on some of the larger bond markets,
08:54and sure, we've seen some volatility in region.
08:56But again, if you take the Chinese market here in region, it's relatively resilient and policy is relatively well understood
09:11and clear.
09:13And so I would suggest the volatility is a little less of a concern to investors than you're seeing in
09:23other parts of the world.
09:24So when you think of the investment needs that companies clearly have in the region and you marry that with
09:34what we're seeing behind us,
09:35which is clients coming into the region to look for opportunities to invest,
09:40I think you've got a stable value proposition that companies are going to take advantage of and investors are going
09:47to look to participate in.
09:51So it feels relatively robust, I think, compared to other parts of the world.
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