The make-up of Hong Kong's benchmark index, the Hang Seng, shows why most emerging markets are considered geared plays on global growth: they are packed with cyclical stocks.
In the Hang Seng's case, economically sensitive industries comprise around 80% of the index. In Western markets, cyclicals usually account for 60% of the market or less. Hong Kong's financials the biggest sector, accounting for almost 60% of the market oil, industrials, and technology firms are in the cyclical category.
Telecoms, utilities and consumer goods (made up of personal and household goods as well as food and drink companies) are defensives.
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