TD Asian Growth manager favours China's Internet giants

Among countries, Andrew Graham is most keen on India.

Sonita Horvitch 24 May, 2017 | 5:00PM

Andrew Graham, head of the Asia team at Edinburgh-based Martin Currie Investment Management Ltd., says that after their strong showing so far this year, stocks in the higher-growth economies of the Asia-Pacific region are no longer that cheap. "These stocks have been rerated," he says, "but current valuations are still more or less in line with the valuation averages over the past decade."

After a fairly modest showing in 2016, the MSCI AC Asia Pacific ex-Japan Index produced a total return in Canadian-dollar terms of 12.2% in the first three months of this year. "This is one of the strongest first quarters for this index in 30 years," says Graham, who has spent almost 30 years in the investment business focusing on the Asia-Pacific region.

Helping to propel the Asia-Pacific index so far this year, he says, is the synchronized global economic recovery, China's move in the first quarter of 2016 to stimulate its economy, and the upgrade in corporate earnings estimates by investment analysts. "Starting in the second quarter of 2016, there has been a strong rebound in the ratio of earnings-estimate upgrades to downgrades." This comes, he says, after "a lengthy earnings-downgrade cycle." Given the index's strong run since the beginning of 2017, there could be some profit-taking, he cautions.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar Rating
Alibaba Group Holding Ltd ADR261.01 USD-0.22
Taiwan Semiconductor Manufacturing Co Ltd ADR63.85 USD-1.44

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Sonita Horvitch

Sonita Horvitch  

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