Emerging-market stocks are trading at the highest valuations relative to advanced-country shares in more than two years as faster economic growth persuades the biggest investors to look past historical sell signals.
The MSCI Emerging Markets Index is valued at 14.1 times reported profits and 1.9 times net assets, compared with ratios of 14.9 and 1.7 for the MSCI World Index, according to data compiled by Bloomberg. When developing-nation equities traded at these levels versus advanced-country stocks in June 2008, the emerging gauge sank 48 percent in four months and trailed the MSCI World index by 16 percentage points.
HSBC Global Asset Management, Morgan Stanley and Deutsche Bank AG say this time is different because developing nations have less debt, more profitable companies and are growing twice as fast as advanced economies. Global money managers are more bullish on emerging markets than any region, while mutual fund investors poured $35 billion into the countries this year, even as they pulled $28 billion from the U.S., Europe and Japan, data from Bank of America Corp. and JPMorgan Chase & Co. show.
No comments:
Post a Comment