LONDON (Reuters) – The remarkable calm in global financial markets in the face of tensions over Crimea and the prospect of an early U.S. rate hike may reflect investors’ lack of appetite for deploying their cash, rather than their complacency.
Geopolitical risks have moved to the top of investors’ worry list as the West extended sanctions on Russia. Federal Reserve chief Janet Yellen also dampened risk sentiment by suggesting the first rate hike could come in the first half of 2015.
Investors have been worried about the effect of a Chinese slowdown on Asian emerging markets, but the long-term growth story is still intact, according to specialist investment manager Matthews Asia.
Consumption is one of the key areas of growth. Illustrating the divergence of Asian economies and their path to prosperity, here’s an interesting chart from Matthews which shows the standard of living of various Asian countries, expressed by applying Geary-Khamis dollars — the concept of international dollars based on purchasing power parity — to today’s Japan.
LONDON (Reuters) – Investors cut equity allocations to a 15-month low and kept their cash levels high in March as tensions in Russia and Ukraine cut risk appetite, a survey showed on Tuesday.
A monthly fund managers survey by Bank of America Merrill Lynch showed investors’ equity holdings fell to a net 36 percent overweight in March from a net 45 percent overweight last month.