Much has been made of the ongoing inflationary issues affecting India, but this is a much wider concern with several government and central banks tightening policy again this month.
Declared earnings have been a mixed bag and JP Morgan pinpoints the consensus at around 14 per cent earnings growth in the region for 2011 and Asian valuations remain reasonable, trading close to mid-cycle historical valuations.
Jahangir Aziz, Asia economist for JP Morgan, says the team remains wary of Asian markets overly discounting global macro-economic risks, including high commodity prices, inflation pressure, tighter monetary regimes, sovereign debt worries and slowing global growth.
He explains, ‘On the other hand, the strength of Korean earnings and order books is incontrovertible evidence that the global economy is healing, albeit fitfully. This global recovery is unambiguously positive for Asia.
‘Over the next few months, we expect Asian markets to remain volatile, allowing investors to take advantage of lucrative trading opportunities.
'Within the region, inflation and currency pressure could hurt market but corporate fundamentals continue to remain strong.’
However, of all the analayst and fund manager commentary over the past four weeks, it is Japan that has had the most encouraging write ups from fund houses.
None more so than F&C Asset Management, who, in noting the country’s relative price to book at an all time low, believes a strong recovery will occur over the coming three months.
F&C Fund manager Jamie Jenkins says whilst further implications of such a catastrophic disaster are still emerging, we have tried to demonstrate that Japan is relatively well equipped to deal with a major supply shock to its energy generation and production basis.
He explains, ‘We do not necessarily subscribe to the idea that the earthquake and tsunami are going to jolt Japan into finally addressing is political paralysis but we do suspect that Japan’s private sector has the capital and ambition to use this as an opportunity to enhance their global competitiveness yet further.’
Source: www.whatinvestment.co.uk
Declared earnings have been a mixed bag and JP Morgan pinpoints the consensus at around 14 per cent earnings growth in the region for 2011 and Asian valuations remain reasonable, trading close to mid-cycle historical valuations.
Jahangir Aziz, Asia economist for JP Morgan, says the team remains wary of Asian markets overly discounting global macro-economic risks, including high commodity prices, inflation pressure, tighter monetary regimes, sovereign debt worries and slowing global growth.
He explains, ‘On the other hand, the strength of Korean earnings and order books is incontrovertible evidence that the global economy is healing, albeit fitfully. This global recovery is unambiguously positive for Asia.
‘Over the next few months, we expect Asian markets to remain volatile, allowing investors to take advantage of lucrative trading opportunities.
'Within the region, inflation and currency pressure could hurt market but corporate fundamentals continue to remain strong.’
However, of all the analayst and fund manager commentary over the past four weeks, it is Japan that has had the most encouraging write ups from fund houses.
None more so than F&C Asset Management, who, in noting the country’s relative price to book at an all time low, believes a strong recovery will occur over the coming three months.
F&C Fund manager Jamie Jenkins says whilst further implications of such a catastrophic disaster are still emerging, we have tried to demonstrate that Japan is relatively well equipped to deal with a major supply shock to its energy generation and production basis.
He explains, ‘We do not necessarily subscribe to the idea that the earthquake and tsunami are going to jolt Japan into finally addressing is political paralysis but we do suspect that Japan’s private sector has the capital and ambition to use this as an opportunity to enhance their global competitiveness yet further.’
Source: www.whatinvestment.co.uk
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