US, China lull may choke Asian investors
SABYASACHI MITRA
REUTERS[ THURSDAY, MARCH 25, 2004 12:03:28 AM ]
HONG KONG : It’s time for Asian equity investors to turn defensive as slowdowns in investment in China and US consumption threaten stock market losses in the region, Credit Suisse First Boston said on Wednesday.
The Swiss investment bank advised Asian investors to buy more utility, telecoms and consumer staple stocks and to lighten up on technology, materials, industrials and consumer cyclical stocks, all of which are vulnerable to a slowdown in global economic growth.
“I think investors in Asia will lose money this year,” Stewart Paterson, chief Asian equities strategist, told reporters at an investment conference hosted by the bank. Paterson advised investors to buy equities in countries such as Australia , where interest rates have room to fall.
CSFB said its biggest overweight position was in Australia , particularly Australian banks — which it saw benefiting from an easing of monetary policy and a bullish bond outlook.
“We are underweight China , Taiwan and Korea and overweight on Australia , Hong Kong and Malaysia ,” Paterson said. He said political turmoil in Taiwan was a “red herring” and that global economic growth and the outlook for the technology sector remain the key drivers of that market. CSFB is neutral on India , Thailand and Singapore .
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