The year 2023 was full of surprises, some good and some, not so. On the bright side, the global economy performed better than expected. Inflation showed signs of slowing down and the US markets performed well. The S&P 500 Index hit an all-time-high, led by tech stocks, thanks to the widespread application of artificial intelligence (AI).
The not so good news was that the Chinese economy did not experience a strong rebound like most investors expected. Additionally, the war in Gaza and the continued Ukraine-Russia conflict weighed on investor sentiment.
Still, most fund managers were able to beat the markets by investing selectively and pivoting to “old economy” stocks. While they continued to seek opportunities within the technology space, some trimmed their exposure to growth companies and pivoted to value stocks.
Particularly on the local front, fund managers benefitted from investing in undervalued companies in various sectors, such as property, construction and utility. They also built up their positions to benefit further from various government initiatives, including the New Energy Transformation Roadmap, New Industrial Master Plan and a slew of infrastructure projects.
This article first appeared in Wealth, The Edge Malaysia Weekly on March 25, 2024 - March 31, 2024
Editor’s note
The year 2023 was full of surprises, some good and some, not so. On the bright side, the global economy performed better than expected. Inflation showed signs of slowing down and the US markets performed well. The S&P 500 Index hit an all-time-high, led by tech stocks, thanks to the widespread application of artificial intelligence (AI).
The not so good news was that the Chinese economy did not experience a strong rebound like most investors expected. Additionally, the war in Gaza and the continued Ukraine-Russia conflict weighed on investor sentiment.
Still, most fund managers were able to beat the markets by investing selectively and pivoting to “old economy” stocks. While they continued to seek opportunities within the technology space, some trimmed their exposure to growth companies and pivoted to value stocks.
Particularly on the local front, fund managers benefitted from investing in undervalued companies in various sectors, such as property, construction and utility. They also built up their positions to benefit further from various government initiatives, including the New Energy Transformation Roadmap, New Industrial Master Plan and a slew of infrastructure projects.
Entering 2024, most fund managers have a constructive and positive view on the local market as equity valuation is at a historical low. They are also of the view that the ringgit has a good chance to strengthen as interest rate differentials tighten globally, while the local bond market appears attractive on the back of steady economic growth. Political stability after several changes in government also helped boost sentiment.
https://theedgemalaysia.com/node/705430
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