The podcast discusses investment opportunities in Asian equities, covering the macroeconomic environment, market specific issues, corporate earnings, manufacturing purchasing manager indices, valuations, dividend growth, and potential impacts on Asian assets.
Asian equities are expected to rebound in 2024 with significant earnings growth in Taiwan and South Korea.
Asian equities, especially high-dividend companies, offer attractive opportunities for investors due to improved corporate earnings and potential international capital flows returning to the region.
Deep dives
Improved Earnings Outlook and Valuations
Asian equities have seen negative returns in recent years, but the earnings outlook is expected to improve. While earnings growth contracted in 2023 due to Taiwan and South Korea, it is forecasted to rebound in 2024 with expected EPS growth of 22% and 70% respectively. The relationship between Asia Extra-Pant Corporate Earnings and Asia Extra-X China Export Growth indicates a strong link between corporate earnings and exports in the region. In terms of valuations, Asia Extra-Pant is trading at 1.5x price to book, historically indicating a high probability of positive returns in the next year.
Opportunities in Dividend Stocks and a Weakening US Dollar
Asian equities offer opportunities for dividend growth, driven by improved corporate earnings. The Asia-Pacific region has a rich source of high-dividend companies across different sectors, including but not limited to technology. With the expectation of a softer US dollar and the end of the Fed's hiking cycle, emerging markets and Asian assets could benefit from international capital flows returning to the region. Additionally, the gradual decline of cash rates in Asian markets makes high-dividend equities more appealing for investors.
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Investment Opportunities and Outlook for Asian Equities
In this 21st episode of the On Investors' Minds - APAC Edition podcast, Tai Hui explores the investment opportunities in Asian equities, including diving into the macroeconomic environment and some of the market specific issues relating to Asian equities. Tai also highlights three key takeaways for investors to consider when adjusting their portfolio allocations. Listen now to get up to date and find out what this all means for investors.
For 10 years, the Market Insights program has been on the ground across the Asia Pacific region engaging with clients, and providing guidance on the complex global markets. Listen now and don't forget to subscribe to stay updated on future episodes of On Investors' Minds - APAC Edition. For more analysis on the financial markets, visit the J.P. Morgan Asset Management website.
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