Mobius still optimistic about EMs
Current underperformance is temporary, he says. Loomis, Sayles & Co says there are attractive returns in fixed income
Add BT as a preferred sourceEMERGING equities are generally out of favour at the moment, but Mark Mobius, executive chairman of the Templeton Emerging Markets Group, is optimistic that the current underperformance is temporary. Elsewhere, Loomis, Sayles & Co portfolio manager Elaine Stokes says there are opportunities for "nice, positive returns'' in fixed income even in an environment of gradually rising interest rates.
In the year-to-date, emerging market equities have lost 5.9 per cent based on the MSCI index, compared to a 26 per cent rise in the S&P 500 and a 19 per cent gain in the MSCI World index. Most strategists continue to tell investors to underweight emerging equities in favour of developed market equities.
Mr Mobius says the Templeton emerging markets group continues to see inflows, and argues that the macroeconomic fundamentals of emerging countries remain stronger than those of developed markets.
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