BUSINESS
The global fund manager survey by Bank of America Merrill Lynch in June shows that a net 31% of investors are overweight (OW) on emerging markets, up from 19% last month.
Global fund mangers are increasingly looking at global emerging markets (GEM) as the risk-equity valuations appear cheap and risk appetite, though still low, seems to be stabilising.
The global fund manager survey by Bank of America Merrill Lynch in June shows that a net 31% of investors are overweight (OW) on emerging markets, up from 19% last month.
“Though the allocations are nowhere near 2009 highs (a net 54% were OW in July-09), EM equity performance has remained robust versus developed markets this year, indicating that investors see GEM as much less risky today relative to other markets,” said Michael Hartnett, Michael Penn and Jacky Tang, equity strategists at Bank of America Merrill Lynch in the survey.
The global FMS further reveals that risk appetite has started to moderate in June after sharp falls last month. “The risk indicator slipped marginally to 37 this month after falling from 46 levels to 38 last month. At the same time, with markets down 10% from recent highs, equities have started looking undervalued (-38%), lowest since March (-42%). However, the markets are not yet compelling enough,” said the survey.
There is also a reduction in negative sentiment towards the euro and European equities. The recent survey shows 19% of the global panel predict the euro will appreciate over the coming year, up from 7% in May. Similarly, the proportion of global investors underweight on eurozone equities has fallen to a net 27% from 34% a month ago.
The survey suggests that confidence in China has fallen to its lowest since January 2009. A net 27% of fund managers expect China’s economy to weaken in the coming 12 months, a big turnaround from April when a net 21% expected the economy to improve.
Among countries in Asia Pacific (ex Japan), the regional investors are most bullish on Indonesia and China, followed by South Korea and India, while Australia is the least favoured.
Domestically, FIIs, that had sold Indian equities worth Rs 9,341 crore in May, have resumed inflows, though the figure is still low at Rs 2,051.80 crore in June till date. The markets have recovered 8.68% from their recent lows on May 25, 2010, with Sensex moving up 1390 points since then.
“People are still skeptical. However, the earnings growth in emerging markets is expected to remain strong and we would see strong inflows resuming soon,” said Sandip Sabharwal, CEO - portfolio management services at Prabhudas Lilladher.
Market participants see Indian equities rangebound in short term, with a positive bias. “The markets, which were having an overhang awaiting the monsoons, would see a rally in line with the boom in the economy as the rains set in,” said Ramesh S Damani, member, BSE.
“Our bias is towards stronger flows keeping in mind the outflows during the previous month. Investors may try to get back in as the situation in their home economies becomes better. The sentiment overall is uncertain and we may see markets trading in a narrow range over the next two months,” said Ajay Argal, co-head of equity investments at Birla Sunlife AMC.
THIS Gautam Adani company's shares are in spotlight as it raises Rs 4200 crore in...
Delhi-NCR's air quality turns 'poor', AQI reaches...
India-Canada row: ‘No action on request to arrest Lawrence Bishnoi gang members’, says MEA
Cyclone Alert: Odisha coast likely to face cyclone next week, IMD issues alert
Noida school horror: Victim's mother reveals 'my daughter was told...'
‘India and Pakistan should bury the past’: Nawaz Sharif after S Jaishankar's visit
'Dil to bachcha hai ji': Rahul Gandhi's heartfelt interaction with kids, WATCH viral video
JEE Main 2025: NTA releases important notice on JEE Main exam pattern
Blow to Mukesh Ambani as Reliance Jio loses 10.9 million subscribers due to...
Joe Biden reacts to Hamas Chief Yahya Sinwar's killing, says 'that obstacle no longer exists but...'
Viral video: Desi girl's sizzling dance to 'Aaj Ki Raat' impresses internet, watch
Watch: Heartwarming video of girl treating slippers like a baby goes viral
Earn Rs 250000000 through THIS NASA challenge: Here’s how you can participate
DNA TV Show: Bahraich murder accused shot in police encounter near Nepal border; 5 held
Good news for Narayana Murthy, Infosys net profit rises to Rs 6,506 crore
Tamannaah Bhatia questioned by ED in Guwahati in money laundering case, details inside
Hamas leader Yahya Sinwar killed in Gaza, Israel PM Netanyahu confirms
UGC NET June 2024 Result DECLARED: NTA announces UGC NET 2024 June exam result online, check here
Did IDF eliminate Yahya Sinwar, or has Martyr been born in Gaza?
Hamas chief Yahya Sinwar among 3 killed by Israel? Israel Defense Forces updates
Kangana Ranaut's Emergency finally cleared by CBFC, new release date...
Here's the film after which Shah Rukh Khan started drinking, his co-stars were Aishwarya Rai and...
Akash Ambani, Shloka Mehta live on 27th floor of Rs 15000 crore Antilia, here's why
Young entrepreneur’s Rahul Sachdeva journey to make foreign education accessible
Is Rajinikanth's Poes Garden home flooded amid Chennai rains? Here's the truth behind viral video
'My family is broken but..': Zeeshan Siddiqui's first reaction to father Baba Siddiqui's death
DNA Auto Award 2024 Has Spoken: Jawa 42 FJ, bringing Neo-classic revolution in Motor Industry
Apple iPad 10th gen vs iPad 9th gen: Should you buy or wait for iPad 11?
Nita Ambani's hairstylist explains why haircuts can't fix damage and offers solutions
Bigg Boss Kannada's Kiccha Sudeepa retires from hosting duties, says 'let's make this season...'
Air India flight from Mumbai transmits emergency signal over London, claims Flight tracker
Elon Musk applauds India's decision: Spectrum allocation favors open access and innovation
BIG UPDATE on IPL auction, Saudi Arabia to host event, will take place on...
Two Bahraich violence accused shot by police in encounter while fleeing to Nepal; 5 held
'I won’t be returning': South African legend bids farewell to Sunrisers Hyderabad ahead of IPL 2025
Indian stargazers spot rare, ancient comet after 80,000 years, see breathtaking pics
'46 all-out new 36 all-out?': Cricket Australia trolls India after batting collapse vs New Zealand
Karwa Chauth 2024: Know the date, timings, history and significance
Mukesh Ambani's Jio superhit 5G plan, offers 90 days validity with unlimited data
IND vs NZ: Virat Kohli equals THIS unwanted record with 9-ball duck against New Zealand in 1st Test
Proba-3: ISRO to launch ESA Solar Eclipse Mission with precision satellites
'Law not blind': Supreme court makes 2 BIG CHANGES, unveils new justice lady and replaced…
J-K: Several CRPF Jawans injured in road accident in Budgam, probe underway
Who is Justice Sanjiv Khanna named CJI Chandrachud's successor, could become next Chief Justice?
Mukesh Ambani's BIG move: Reliance investors to get this DIWALI bonanza, know details here
'Ravan ko kisne maara?' This kid's hilarious answer will leave your in splits, WATCH viral video
Nayab Singh Saini takes oath as Haryana CM in presence of PM Modi, BJP brass
IND vs NZ: India all out for 46 runs, lowest test score at home
Hunter's Moon 2024: NASA drops first glimpse of brightest Supermoon, shares its significance
Meet man, IIT graduate who worked for Indian Railways, then went on to join Elon Musk's...
IND vs NZ: Devon Conway takes one hand blunder, gets Sarfaraz Khan on duck, watch video here