Fidelity favours Singaporean, Malaysian stocks in short term

MIDF Research said in retrospect, foreigners offloaded -RM19.5bil and -RM6.9bil in 2015 and 2014 respectively.

SINGAPORE: Fidelity International favours Singaporean and Malaysian stocks in the short term, while it likes Thai stocks the least in Southeast Asia because of weak growth.

Singapore benefits from global and regional growth because of the focus of businesses in the city-state, says Gillian Kwek, equities portfolio manager for Southeast Asian equities.

“Outlook for Malaysia’s corporate earnings is good in next six to 12 months because of upcoming elections and increased investments,” she said at media briefing on Thursday.

Asean benefits from young and growing workforce, rising savings rate; government are capping their fiscal deficits to 3% of GDP and that’s helped maintain stable monetary policies.

Meanwhile, Fidelity is cautious on credit markets, according to Charles McKenzie, the London-based chief investment officer for global fixed income.

He cites risk of recession in US, which has had 32 quarters of successive growth; that’s good for govt bonds but not for credit.

Also points out that excessive leverage globally is an unresolved financial risk

In Asia US dollar-denominated debt market, there are investment opportunities in triple-B and double-B as the “sweet spot" for credit, Bryan Collins, fixed-income portfolio manager for Asia
Pacific, says at same briefing. - Bloomberg