Taking a look at #Asia – Research Highlights

Editorial Team OpinioPro
By April 23, 2021 08:56

Taking a look at #Asia – Research Highlights

In April T. Rowe Price published an article named “Why ESG Factors Matter in Asia Credit Investing”. In the article, they discuss the upcoming importance of ESG factors when looking at Asian credit. T. Rowe Price expects that the ESG landscape in Asia will continue to develop due to it being in an early development stage. Another expectation is that a divergence will take place in which countries make the most stride towards ESG awareness. In four years the amount of sustainable issuance has increased sevenfold due to stricter government regulations focussed on the dept and breadth of comparative ESG data. The increasing effort towards more ESG disclosure also arises from the growing push towards carbon neutrality.

T.Rowe Price believes that incorporating ESG factors into a bottom-up research process can help identify high-quality forward-thinking businesses with greater prospects for improved credit risk profiles.

In a Q&A by Capital Group and Christopher Thomsen, a look is taken at the increasing attractiveness of investing in Asia. Christopher Thomsen states that next to the obvious key focus of China, India is another attractive market to look at due to its young, fast-growing and vibrant population with a strong entrepreneurial spirit.

The last publication we look at is from BNP Paribas Asset Management named: “Asian equities inspire confidence, even after volatile quarter”. They state that even though capital flows reversed for growth markets due to concerns of increasing US bond yields, earnings and growth rates have been good which contributes to a good earnings and cashflow outlook.

BNP Paribas AM states that a clear differentiation has to be made between north- and south-Asia. North-Asia has done relatively well, where mobility levels are back to pre-pandemic levels and the hospitality sector has reopened which fuels the recovery. Where south-Asia has done relatively poor, which can also be seen in capital flows.

Next to volatility, BNP Paribas AM looks at the risk of interest rate volatility. Some of the sectors that seem appealing to BNP Paribas AM are: consumption (turnaround and e-commerce), technology, financials and Indian/ASEAN companies with unique features.

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Editorial Team OpinioPro
By April 23, 2021 08:56

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