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BNP Paribas upgrades India to overweight 'Reuters | Updated On: February 26, 2014 17:12 (IST) India and Indonesia, previously at risk from severe currency depreciation and liquidity tightening, have recovered in terms of their trade and current accounts, and to a lesser extent in terms of inflation, the BNP report added.' 'Weak currency and high imports had earlier put a strain on the two nations among "the fragile five" by widening their current-account deficit.' http://profit.ndtv.com/news/market/article-bnp-paribas-upgrades-india-to-overweight-381652
A More In-depth Presentation of Emerging Market Oppotunities EM and the Fragile Five: Separating the Wheat from the Chaff TCW Asset Management By Blaise Antin, David Loevinger, Anisha Ambardar February 26, 2014 Looking ahead, we believe that 2014 will be a year where differentiation matters. Investors who ignore the naysayers and instead focus on the risk/reward characteristics of individuals countries through old-fashioned fundamental analysis will be well rewarded. Beyond the Fragile Five, there are many EM countries that have strong or improving credit outlooks. Given investors’ attention to the Fragile Five, in the following section we present a brief analysis of the vulnerabilities of each, how they compare now with previous periods when these countries experienced systemic crises, and the extent to which policy adjustments to date are leading to macroeconomic adjustments that will put these economies on a sounder path.
Our bottom line on the Fragile Five: Overall risk is relatively low in Brazil, moderately high in Turkey, with Indonesia and India closer to Brazil, and South Africa in the middle. In the next section, we discuss each country in order of our assessment of their vulnerability, from low to high. http://advisorperspectives.com/commentaries/tcw_022614.php And more from T C W Emerging Markets Multi-Asset Opportunities Fund TGMEX When we look across the investment spectrum for emerging markets, we prefer equities to debt, which we are expressing through our breakdown of 66% equity and 31% debt. We believe that improving growth in the U.S., bottoming out of Europe and stable growth in EM countries, most notably China, should create a positive environment for EM equities. We see potential for strong performance in EM equities in 2014 with improved revisions and earnings growth balanced against a potential derating on the back of a higher cost of capital. The upside risk to our forecast could come from other global factors, for instance any further expansion in the S&P 500 P/E , which would help alleviate the downward pressure on EM multiples. We remain focused on combining some of our macro country views with more idiosyncratic positions around what we see as multi-year growth stories, including gaming and internet penetration, growing use of generics and renewable energy. We further remain opportunistic on frontier markets but, given the stellar year for MXFM in 2013, we think the opportunity for significant outperformance by FMs relative to EMs is more limited in 2014 https://www.tcw.com/~/media/Downloads/TCW Funds/Quarterly Letters/EOF_QL.ashx
Comments
'Reuters | Updated On: February 26, 2014 17:12 (IST)
India and Indonesia, previously at risk from severe currency depreciation and liquidity tightening, have recovered in terms of their trade and current accounts, and to a lesser extent in terms of inflation, the BNP report added.'
'Weak currency and high imports had earlier put a strain on the two nations among "the fragile five" by widening their current-account deficit.'
http://profit.ndtv.com/news/market/article-bnp-paribas-upgrades-india-to-overweight-381652
A More In-depth Presentation of Emerging Market Oppotunities
EM and the Fragile Five: Separating the Wheat from the Chaff
TCW Asset Management
By Blaise Antin, David Loevinger, Anisha Ambardar
February 26, 2014
Looking ahead, we believe that 2014 will be a year where differentiation matters. Investors who ignore the naysayers and instead focus on the risk/reward characteristics of individuals countries through old-fashioned fundamental analysis will be well rewarded. Beyond the Fragile Five, there are many EM countries that have strong or improving credit outlooks. Given investors’ attention to the Fragile Five, in the following section we present a brief analysis of the vulnerabilities of each, how they compare now with previous periods when these countries experienced systemic crises, and the extent to which policy adjustments to date are leading to macroeconomic adjustments that will put these economies on a sounder path.
Our bottom line on the Fragile Five: Overall risk is relatively low in Brazil, moderately high in Turkey, with Indonesia and India closer to Brazil, and South Africa in the middle. In the next section, we discuss each country in order of our assessment of their vulnerability, from low to high.
http://advisorperspectives.com/commentaries/tcw_022614.php
And more from T C W Emerging Markets Multi-Asset Opportunities Fund TGMEX
When we look across the investment spectrum for emerging
markets, we prefer equities to debt, which we are expressing
through our breakdown of 66% equity and 31% debt.
We believe that improving growth in the U.S., bottoming out of
Europe and stable growth in EM countries, most notably China,
should create a positive environment for EM equities. We see
potential for strong performance in EM equities in 2014 with
improved revisions and earnings growth balanced against a
potential derating on the back of a higher cost of capital. The upside
risk to our forecast could come from other global factors, for
instance any further expansion in the S&P 500 P/E , which would
help alleviate the downward pressure on EM multiples. We remain
focused on combining some of our macro country views with more
idiosyncratic positions around what we see as multi-year growth
stories, including gaming and internet penetration, growing use of
generics and renewable energy. We further remain opportunistic on
frontier markets but, given the stellar year for MXFM in 2013, we
think the opportunity for significant outperformance by FMs relative
to EMs is more limited in 2014
https://www.tcw.com/~/media/Downloads/TCW Funds/Quarterly Letters/EOF_QL.ashx