Standard Chartered keeps India core holding but prefers China in Asia ex-Japan

Fook Hien Yap, Senior Investment Strategist at Standard Chartered said India remains an important market for investors but noted that China is its preferred pick in Asia ex-Japan for now.“India still remains as a core holding to us within Asia ex-Japan,” he said. However, he added that earnings revisions in India are still negative despite policy support and steady growth expectations. “We want to see that turning before we see a bit more interest developing and coming into India,” Yap said.

On the region overall, Yap said Standard Chartered continues to have an overweight view on Asia ex-Japan. A weaker US dollar is expected to support investor flows into the region. “In a weak dollar environment, we see that investor flows tend to look for better returns in a non-US dollar asset,” he said, adding that Asia ex-Japan is likely to benefit from this trend, along with policy measures in China and technology growth.

Also Read | Manulife Investments neutral on Indian equities for lack of short-term triggersFor US equities, Yap said the outlook remains positive but pointed out that markets could face some consolidation after recent gains.

The bank also sees strong prospects for gold. Yap said Standard Chartered will publish an updated target for gold soon and noted the metal could move above $4,000 per ounce. Central bank purchases, ETF inflows, and falling real rates are expected to support prices. Yap added that gold remains a key hedge for investors against both inflation and geopolitical risks.

For the full interview, watch the accompanying video

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