MUMBAI, Sept 19 (Askume) – Multi-asset fund managers at London-based M&G Investments said on Thursday they view valuations of some long-duration government bonds and non-U.S. stocks as attractive.
A day after the Federal Reserve cut interest rates by 50 basis points and revised its outlook for monetary policy , M&G’s Gautam Samarth said his company would remain “reactive” to market moves and when pessimism appears excessive or optimism emerges, it would respond to opportunities in the opposite direction.
“We have some long-term U.S., U.K. and German government bonds. Valuations are reasonable and they offer diversification potential if growth starts to slow,” Samas told the Askume Global Markets Forum.
As of June 30, M&G Investments had more than £346 billion ($458 billion) of assets under management.
Samarth also said that with the market turning sharply higher since April, M&G has adopted a “cautious stance” towards short-term interest rates.
“It appears to be an environment where risks are controlled, but the price of risk is rising,” he said.
He said this is why the Federal Reserve decided to cut interest rates and why the central bank should adopt an accommodative stance.
Samas said China’s stock market prices were attractive and it was an “opportunity” given the negative sentiment in the market there.
Mexico and Brazil hold importance in Latin America, he said, adding that both countries offer “relatively unique investment opportunities” because of their political landscapes. He added that although European and UK markets are performing well, they still offer some value.
Samath said corporate profits in India remain strong despite expensive valuations.
“It is difficult for us to buy Indian stocks at current levels, but we are certainly not shorting them.”
($1 = 1.3246 British pounds)
