Thai tourism stocks beckon as Asean seen as trade-war shelter
published : 26 Mar 2018 at 14:03
writer: Bloomberg News
SINGAPORE: As a US-China trade war threatens to wreak collateral damage on the globally-connected North Asian economies, Southeast Asia’s domestically-focused and relatively cheap stocks are looking more appealing.
“Asean would act as a relative safe haven during a trade war,” said Nader Naeimi, the Sydney-based head of dynamic markets at AMP Capital Investors Ltd., which oversees around $130 billion. More domestic-focused stocks, relatively low exports to the US and a bigger reliance on commodities are the reasons to own Southeast Asian shares at the moment, he said.
Thailand’s SET Index had fallen only 0.1% since Thursday’s close as of 1.29pm in Bangkok, while the Kuala Lumpur Composite Index was down 1.1%. That compares with drops of 4.2% in the Shanghai Composite Index and 2.4% in the Kospi Index.
Given the diversity within Southeast Asia, investors will need to take a discerning approach to find the best defensive plays. Thai tourism companies, Singaporean financials and Malaysian auto stocks are some of strategies favoured by some asset managers.