Hong Kong Highly Favoured By Global Fund Managers

by Mary Swire, Tax-News.com, Hong Kong

22 June 2004

According to a monthly survey conducted by Merrill Lynch, Hong Kong is identified by international fund managers as the most favoured market over the coming year, whilst mainland China is considered to be the least favoured.

Respondents to the investment bank’s monthly Global Fund Managers Survey cited the recovery in Hong Kong’s property market and forecast currency market movements as major reasons why the territory is being viewed favourably.

“They [fund managers] are positive towards the recent land auctions and the potential for higher residential property prices,” observed Merrill Lynch regional equity strategist Stephen Corry.

The Hong Kong government recently raised HK$3.7 billion (US$475 million) from two separate land auctions.

The survey also found that 15% of fund managers intend to be overweight Hong Kong, whilst at the bottom of the list, 15% of the managers revealed they will be underweight China, due largely to concerns over new administrative measures implemented in the mainland.

Of the 138 global fund managers questioned, 61 were of the view that China’s economy will weaken in the short term, and 74 expressed concerns over rising inflation.

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