Fund managers favour China equities

Bonds also still popular

By Darin Tyson-Chan
Fri 03 Jul 2009

Global fund managers are more bullish about Greater China equities.

The latest HSBC fund manager survey has revealed positive sentiment towards Greater China equities has strengthened among global managers over the past three months.

The most recent study showed 75 per cent of managers polled now held an overweight view towards the Greater China equity market at the end of the second quarter of 2009, compared to 57 per cent that shared this opinion when the first quarter of the year had concluded.

"Greater China remains the most favoured equities sector as recent economic indicators point to signs that the effects of the stimulus measures are starting to filter through the local economy," HSBC Bank Australia head of global investments Charles Genochio said.

However, this positive attitude did not translate to all equity markets, with global managers continuing to shun both the European and Japanese arenas.

The proportion of managers who took an underweight view on European stocks rose in the second quarter of 2009 from 22 per cent to 36 per cent.

In relation to Japanese equities this shift in sentiment was even more pronounced, with 36 per cent taking an underweight stance at the end of the first quarter in 2009 as opposed to 70 per cent lending their support for this sentiment in the second quarter.

While attitudes towards most equities markets worsened, managers surveyed consolidated their positive views on bonds.

In regard to European bonds, 56 per cent of respondents held an overweight view compared to 50 per cent at the end of the first quarter. Similar feelings were communicated for US bonds, up to 44 per cent from 29 per cent.

Twelve of the leading fund managers based on funds under management took part in the HSBC survey.

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