From Bloomberg:
Coutts Says Emerging-Market Crisis ’Talk’ as Wealthy Buy
Coutts & Co., the wealth management unit of Royal Bank of Scotland Group Plc (RBS), said it doesn’t see a crisis in emerging markets and the firm’s rich clients are taking advantage of this year’s declines to boost holdings.
“If you look at the balance of trade that our clients are doing, they’re buying,” Gary Dugan, the chief investment officer in Asia and the Middle East for Coutts, which counts Queen Elizabeth II among its clients, said in a interview yesterday in Dubai. “There’s been an appetite for Asia and for Russia after the sell-off. There’s no crisis, it’s just talk.”
Emerging-market assets have tumbled this year as China’s economy slowed, weak currencies from India to Turkey spurred central banks to raise interest rates and the U.S. Federal Reserve pushed ahead with plans to reduce monetary stimulus. Investors removed more than $12 billion from developing-nation equity funds in the two weeks to Feb. 5, the biggest outflow since January 2008, according to Morgan Stanley, citing data from EPFR Global.
The rout, which sent valuations on emerging-market stocks to the lowest level in more than five years versus advanced-nation shares, is dividing investors. Jim O’Neill, the former chairman of Goldman Sachs Asset Management who created the BRIC moniker for the largest emerging markets, said the losses are a buying opportunity. Mark Mobius, who oversees more than $50 billion as chairman of Templeton Emerging Markets Group, said last week his firm is holding off from buying as it expects the sell-off to continue....MORE
