11-19-2018, 12:53 PM
China’s government bonds -- the world’s best performing sovereign notes so far this year -- may have room to advance even further. The securities will be supported by more monetary easing and stronger safe-haven demand amid lingering trade tensions, record corporate bond defaults and dropping stocks, China watchers say. The yield on 10-year sovereign notes has tumbled 54 basis points in 2018, while the costs on similar debt of most other major economies rose. Chinese yields fell 13 basis points last week, the biggest drop since April.
The World's Biggest Bond Rally Is Picking Up Steam in China - Bloomberg
The MSCI Asia ex-Japan index has fallen more than 20 percent from its 2018 highs, and Tantia is seeing opportunities amidst the turmoil. “I like Asian markets because I think there’s a big divergence between fundamentals and prices,” he said. “Prices have moved far ahead of fundamentals.” “You look at the earnings picture for Asian markets, we are still looking at 10 percent kind of growth for 2019. Valuation is extremely cheap and this year, we have seen thirty billion dollar(s) of outflows from Asian equities which we have never seen going back to 2008,” Tantia said.
Credit Suisse: opportunities in Singapore, China and Indonesia