Buy Stocks While Valuations are Attractive: Strategist
Foreign investors, after a six-month drought, have been sending billions of dollars back to Asia, a trend some expect to continue on hopes China will lead the region out of the global recession.
"Our confidence in China's market is getting stronger and stronger. China's domestic consumption has been picking up since March," said Frank Gong, chief China strategist of the U.S. firm.
"Chinese consumers dared to buy properties and cars when people in other countries were tightening their spending amid the global economic slowdown," Gong said. "If China's GDP growth hits 10 percent in Q2 and in Q3, as investors are expecting, its stock market should be okay."
Taiwan stocks, among the world's top performing markets along with China so far this year, received an upgrade from JPMorgan, which predicted the main index will finish this year at 8,000 points, up from 6,000 previously forecast, partly due to improving ties between Taiwan and China.
On Wednesday, Taiwan shares ended up 0.82 percent at 6,485.14 points, hovering near eight-month highs, after the island announced new regulations for Chinese to invest in the island.
JPMorgan had overweight ratings on shares of Chinatrust Financial, Yuanta Financial and technology shares like Acer, TSMC, smartphone maker HTC and Mediatek.
Copyright 2009 Reuters.