| The U.S. Federal Reserve says it will start buying individual corporate bonds. Beijing is warming up to the idea of four more years of Trump. And Hong Kong expats face a tough decision over whether to stay in the city. Here are some of the things people in markets are talking about today. The Federal Reserve said Monday that it will begin buying individual corporate bonds under its Secondary Market Corporate Credit Facility, an emergency lending program that to date has purchased only exchange-traded funds. The central bank also spelled out for the first time how it plans to implement its buying strategy, saying it would follow a diversified market index of U.S. corporate bonds created expressly for the facility. The Fed built the index internally, and a spokesman couldn't immediately say whether its details would be made public. "This index is made up of all the bonds in the secondary market that have been issued by U.S. companies that satisfy the facility's minimum rating, maximum maturity and other criteria," the Fed said in a statement. The creation of the index removed a potential hurdle for companies that would have had to certify that they were in compliance with restrictions outlined for the program, causing cause for cheer with investors. Asian stocks are set to start trading stronger on Tuesday after the Fed's announcement, which overshadowed concerns of a second pandemic wave and helped to lift U.S. equities. The dollar fell against peers. Futures were higher in Japan, Australia and Hong Kong. The S&P 500 closed up 0.8% after swinging from loss of as much as 2.5% to a gain of as much as 1.3%. Oil rebounded after dropping to less than $35 a barrel. Treasuries dipped. Elsewhere, oil was back above $37 a barrel amid signs of improving demand and declining production. Donald Trump has argued frequently of late that China is rooting for Joe Biden come November's U.S. presidential election. In Beijing, however, officials have come around to the idea of four more years of Trump. Interviews with nine current and former Chinese officials point to a shift in sentiment in favor of the sitting president, even though he has spent much of the past four years blaming Beijing for everything from U.S. trade imbalances to Covid-19. The chief reason? A belief that the erosion of America's postwar alliance network would outweigh any damage to China from continued trade disputes and geopolitical instability. "If Biden is elected, I think this could be more dangerous for China, because he will work with allies to target China, whereas Trump is destroying U.S. alliances," said Zhou Xiaoming, a former Chinese trade negotiator and former deputy representative in Geneva. Four current officials echoed that sentiment. One of Hong Kong's toughest years in decades is leading many expats to wrestle anew with the question: Do I stay or do I go? The choice for Hong Kong's foreign resident community, especially the 90,000 or so people who come from major economies outside Asia, is stark. If they stay, they face renewed disruptions arising from political turmoil amid efforts by China to impose a national security law. To leave is to risk relocation at a time when the global economy is crippled by the coronavirus. After weathering a year of U.S.-China trade tensions, anti-government protests and the worst viral outbreak since the 2003 SARS crisis — on top of the national security legislation announced in May — some are leaning toward the latter. That's according to surveys and data from local business groups and mobility firms. While once expatriates in Hong Kong typically worked in finance or law for Western companies and had generous relocation packages, the group is now more diverse so determining a consensus is difficult. An Australian equity fund that has returned more than twice its benchmark index since 2006 is holding higher levels of cash, citing skepticism over the furious recovery in markets. Greencape Capital's Ryan Green says he's finding fewer opportunities to buy stocks at attractive valuations after the rebound from the March lows. And the uncertainty over the shape of the economic recovery means he's building a buffer to cushion the portfolio against more turmoil. "We're finding it hard to deploy cash because we're not finding sufficient value," said Green, who co-manages the Greencape Broadcap Fund and helps oversee about A$3 billion ($2.1 billion) in assets. "We've rotated the portfolio to be a little bit more defensive, given that the rebound has been so rapid." The Broadcap fund has climbed 9.4% annually since September 2006 before fees, topping the 4.5% year gain in the S&P/ASX 300 Accumulation Index in that time. What We've Been Reading This is what's caught our eye over the past 24 hours: And finally, here's what Tracy's interested in this morning Bear markets are generally thought to be active managers' chance to shine. When the proverbial hits the fan, active managers are supposed to keep cool and calmly steer their respective portfolios through the tough times while retail investors panic en masse. Even more importantly, professionals might actually make some savvy investing decisions and scoop up some good stocks on the cheap. One of the legacies of the 2020 financial crash, however, might just be that active managers will no longer be judged by their performance in bad times, but rather, by their performance during good times. On that measure, the professional class hasn't compared very favorably to amateurs.  David Kostin, chief strategist at Goldman Sachs, points out that a portfolio of stocks most popular with retail investors has surged 61% since the market low in March, compared with a 36% rise in the S&P 500. Meanwhile, stocks beloved by hedge funds and mutual funds have produced a gain of 45%. Fund managers distrustful of the rally will reasonably argue that the Federal Reserve's emergency measures are inflating a giant bubble and distorting the market. But in a scenario where value is determined by flows and liquidity rather than fundamental value, predicting where money will next go next becomes even more important. On that basis, the guy trading stocks in his basement might actually have an edge. There's now a Japanese edition of Five Things. 世界のビジネスニュースを毎朝メールでお届けします。ニュースレターへの登録はこちら。 | 
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