China, S’pore remain top Asian markets: Macquarie

China, S’pore remain top Asian markets: Macquarie


(MANILA) China and Singapore should stay as the top two market picks for stock investors in Asia as the region faces the impact of higher oil prices and inflation, Macquarie Group Ltd said.


Investors should own more shares in China and Singapore than suggested in regional benchmarks, analysts Tim Rocks and Daniel McCormack recommended in a report released yesterday. They also increased their suggested weighting for South Korea and cut that for India, two of five markets they recommend investors should own less than suggested by regional stock measures.


‘China will deliver the strongest earnings growth this year while in Singapore a US recession is fully priced in,’ they said. A weakening in the won could boost export earnings of South Korea’s companies while ‘downside risks are growing’ in India.


Corporate earnings will probably increase between 15 and 20 per cent this year in China, they added. Separately, Singapore’s stocks are trading at 11 times earnings, the cheapest in the Asia-Pacific region, according to Bloomberg data.


The CSI 300 Index, which tracks yuan-denominated A shares listed on China’s two exchanges, has slumped 33 per cent this year while Singapore’s Straits Times Index has declined 9.7 per cent.


The analysts cut their suggested weightings for property and consumer stocks as rising inflation and interest rates slow spending. They increased their weighting for banks, saying finance is ‘now one of the cheapest sectors in Asia’\. \– Bloomberg


Source: Business Times

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