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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: RealMuLan who wrote (58066)	1/1/2005 7:13:18 PM
From: RealMuLan	Read Replies (1) \| Respond to of 74559

Asian stocks top 2005 shopping list HONG KONG: Shares are overwhelmingly the investment choice of Asian fund managers for 2005, with Hong Kong their top pick for its strong consumer spending growth and pegged currency that keeps exports competitive, a survey has found. The poll by Reuters and monthly investment magazine Benchmark showed utilities and telecoms among the preferred stock sectors because they depend on domestic demand rather than exports suffering from a weak dollar. The survey found that seven out of nine respondents preferred to hold stocks over the next 3 months and six of them over the next year, even as Asian bourses hit multi-year highs. The only other investment choice named by respondents was real estate. “We like the long-term Asia domestic growth story and think the next decade will be Asia’s for Asians,” said Alex Boggis, director at Aberdeen International Fund Managers Ltd., Hong Kong. MSCI’s broadest index of Asia Pacific shares outside Japan hit its highest level in nearly 5 years on Wednesday. Boggis said he preferred companies facing long-term domestic growth rather than export-orientated firms. Many export-led economies shivered this year as the dollar crumbled to record lows on fears the United States, the world’s biggest economy, would struggle to fund its budget and current account deficits. So while the Philippine, Korean and Taiwanese markets were among the least popular in the survey, Indonesia and China were favoured destinations over the next year because of their domestic market potential. Hong Kong, where the benchmark Hang Seng Index has risen 13 percent in 2004 to its best levels in almost 4 years, was the favourite market for the first quarter. Keeping Hong Kong humming: “Although China faces an investment slowdown, its consumption will be robust and that spillover will keep Hong Kong humming next year,” said Bratin Sanyal, head of Asian equity investments at ING Investment Management. Over the next three months, four out of the nine said they preferred Hong Kong, one plumped for Hong Kong and India while Indonesia and India got one vote each. For the next 12 months, three respondents preferred Indonesia, two respondents each liked Hong Kong and China while one chose India. “Indonesia has been one of our favoured markets for quite some time as we believed that political risks were being overstated by the market,” said Ian Beattie who manages the New Star Asian Opportunities Fund. Indonesia’s new president Susilo Bambang Yudhoyono is seen as the most capable leader of the country since it plunged into chaos during the 1997-98 Asian financial crisis. And although Indonesian stocks have struck record highs after the October elections, leading Asian markets with a 45 percent rise this year, Beattie felt corporate valuations were reasonable as returns on capital were very high. Among sectors, the survey found respondents preferred property plays, in particular Hong Kong property, for the next 3 months while utilities were the least popular sector over both 3 months and one year. Sanyal, however, said ING liked utilities because they rely on domestic demand for growth. “We want to invest in companies with high yield, earnings growth and which are domestic-oriented ... We find a combination of all three in utilities and telecom.” Materials, oil & gas and property stocks were popular for the short-term only, while technology and electronics were the investments of choice for the longer term. Risks which posed the biggest threat to Asian markets were high oil prices and rising US interest rates, the survey found. —Reuters dailytimes.com.pk