Tisco upbeat on outlook for trio of Asian bourses
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Tisco upbeat on outlook for trio of Asian bourses

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Tisco Bank has identified India, Vietnam and Japan as the three standout stock markets to help investors achieve attractive returns amid global trade tensions, particularly once US president-elect Donald Trump takes office next week.

Vorasinee Sethabutr, head of wealth product development at Tisco Bank, said if the US intensifies trade protection policies by increasing tariffs on its trading partners, stock markets in the countries in question would be negatively affected.

However, India, Vietnam and Japan are expected to remain resilient or face minimal effects, making them attractive investment destinations, she said.

Historical data from Bloomberg shows that the 2017–2019 US trade war resulted in a 43% increase in the US's S&P 500 index while the Indian, Vietnamese and Japanese bourses surged by 55%, 34% and 21%, respectively.

These three stock markets are also supported by strong domestic consumption, which accounts for over half of their GDP, providing economic stability during global trade slowdowns.

Bloomberg projects India's GDP growth at 6.9% this year, the highest among all countries worldwide.

Government incentives, such as tax benefits for foreign investors, could further boost corporate earnings by 15%, enhancing the country's growth potential.

Tisco estimates Japan's GDP to grow by 1.1% in 2025, recovering from decades of deflation.

Supportive government measures, including tax cuts and wage hikes, are expected to drive domestic consumption and economic expansion.

Meanwhile, Vietnam's strong trade surplus with the US, low labour costs and advanced technology expertise attract foreign investment.

With 16 free trade agreements in place, such as the EU-Vietnam free trade agreement and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, Vietnam remains insulated from tariff impacts.

To capitalise on these opportunities, Tisco recommends investors consider three equity funds tailored to each market.

For India it recommends the Tisco India Active Equity Fund (TISCOINA-A), a high-risk fund which invests in foreign equity funds or exchange-traded funds focused on companies operating in or generating significant revenue from that country.

The fund offers flexibility and diversification through three key holdings including Goldman Sachs India Equity Portfolio I Acc USD (32.60%) which focuses on mid- and small-cap Indian companies; FSSA Indian Subcontinent Fund (32.26%), which invests in large, mid and small-cap companies across India, Sri Lanka, Pakistan and Bangladesh; and Nomura Funds Ireland – India Equity Fund (31.99%), which targets 25–30 large-cap Indian stocks.

For the Japanese market, Tisco recommends Krungsri Japan Hedged Dividend Fund (KF-HJAPAND), a high-risk fund that invests in the JPMorgan Japan (Yen) Fund, with an active management strategy.

This fund focuses on Japanese companies that are benefiting from structural changes, such as demographic shifts, technological advancements and tourism growth.

Finally, the bank suggests the Principal Vietnam Equity Fund (PRINCIPAL VNEQ-A) which invests in high-potential Vietnamese equities. It focuses on 20–30 liquid, mid-to-large cap stocks, leveraging a top-down approach for macroeconomic and industry analysis.

Nonetheless, Tisco noted that past performance is not indicative of future results, and investments in these funds carry inherent risks, including potential currency fluctuations. It is essential for investors to thoroughly understand a fund's characteristics and risks before investing.

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