“Women hold up half the sky,” was a proclamation made by Mao Zedong. It was mainly intended to prove that women are a resource that ought to be deployed outside of the homes into the professional fields.
The proclamation was cynically modified in the early part of the 21st century to read: “Women hold up half the sky, but only if they have money”.
Twenty years into the new century, it is estimated that between 35% and 50% of senior executive and management positions are held by women in China. China is no stranger to women in powerful positions with large numbers of women occupying the top jobs — particularly CMO roles — in major companies. China has two-thirds of the world’s self-made female billionaires, with a total of 85.
Around 60% of women are employed in China’s workforce, compared with 64% in Singapore and just 50% in Australia.
The women’s participation rate in China has remained steady for decades, but the big change is the increases in wages. In 2021, the median per capita disposable income of residents in China was 29,975 yuan ($6,380), or an increase of 8.8%. In a recent survey of Chinese career women, the average monthly income of the female respondents in 2020 reached 8,173 yuan.
The infamous Factory Girls and their wage and work conditions still exist, but the idea of cheap labour in China has long disappeared, with cheap jobs going to Vietnam, Bangladesh and Cambodia. The increases in minimum wages are a move towards a moderately prosperous society and common prosperity.
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Don’t be too quick to dismiss these slogans because behind them are genuine policy initiatives that give women more disposable income.
Now it is more appropriate to say, “Women hold up half the sky and they do have money”. How they choose to spend that money is shaping the business environment and opening up opportunities beyond the traditional fashion and cosmetic sectors. These sectors remain vibrant, but they are a crowded niche with strong competition from established international brands. Despite this, there are some very successful homegrown cosmetic brands that appeal to more patriotic purchasers.
Women are choosing to spend on an array of new products. The startup Fiture raised US$400 million ($543 million) and launched a self-defence course from Israel, designed for women to fight violence and harassment. This featured a “magic mirror” so users can exercise at home, with online courses and AI-featured tutoring.
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Shanghai-based game, 100 Views of Jiangnan, allows players to build Ming Dynasty (1368-1644) cities in Jiangnan. It taps into the HanFu movement which promotes the wearing of traditional dress. It also promotes traditional culture. In the Ming Dynasty, there were many women making great contributions to society and this game allows female players to take on these roles.
Women have become a major tourism market and they spend 33% more than men. Ctrip notes that the demand for family trips with more than one child and single-women trips are both growing rapidly.
These are new services and business areas which have grown because of the increase in women’s disposable income.
Technical outlook for the Shanghai market
The dramatic Shanghai Index collapse was followed an equally dramatic rebound. The index fall did not quite reach the downside support level near 3,000. The rebound has taken the index above the previous historical support level near 3,220.
On the positive side of the ledger, this is bullish and traders will watch the consolidation activity in this area because this may develop a base for a new rally towards 3,360.
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On the negative side of the ledger, this historical support level near 3,220 did not act as a support feature as the market fell. This means any consolidation around this level is less reliable than it has been in the past. As a result, traders will wait for further evidence that support can hold and develop a sound base for a new uptrend.
Currently, the key feature of the index is its volatility, coupled with the way historical support and resistance levels failed to act as pause-points when the market fell. This casts some doubt on their continued ability to influence the market going forward.
The result is that the index behaviour is best treated as a fast rally and retreat environment rather than a trending environment. Paradoxically, it is these retreats followed by a rally that will provide the necessary anchorpoints for the plotting of a more stable uptrend line. It is too early to know if the low around 3,040 can be used as the first anchor-point for any sustainable uptrend line.
Moving forward, traders will also watch for evidence that the previous historical pause-points can again act as reliable and consistent pausepoints around which a sound trading strategy can be built. On balance, it is most likely this will occur, particularly around the 3,350 and 3,460 levels. These have been long-term consistent reference levels over the past several years.
The behaviour of the long-term group of averages in the Guppy Multiple Average Indicator confirms the continued downward pressure. This cluster of averages also signals a significant resistance feature that will hamper any sustainable recovery.
Daryl Guppy is an international financial technical analysis expert. He has provided weekly Shanghai Index analysis for mainland Chinese media for two decades. Guppy appears regularly on CNBC Asia and is known as “The Chart Man”. He is a national board member of the Australia China Business Council. The writer owns China stock and index ETFs
