Six in ten (63%) Asian investors remain optimistic about the six-month outlook for stocks in their region, and nearly four in ten (38%) plan to invest more in the next six months, UBS Global Wealth Management’s latest quarterly investors sentiment survey shows.
It found that 44% of Apac investors think inflation will last longer than 12 months, while 39% think it will last between six and 12 months. About 89% of Apac investors feel the impact of inflation on day-to-day life from the higher prices for goods.
UBS GWM surveyed 3,000 investors with at least $1m in investable assets from 4 to 24 January, 2022. The global sample was split across 15 markets.
Among Hong Kong investors, 52% said they want to add stocks to their portfolios while 46% said they will reduce bonds.
About 67% of Hong Kong investors remain optimistic on the region’s economy for the next 12 months, which is down from 70% since the third quarter of 2021.
Covid-19 is their top concern, with as much as 62% concerned about the pandemic situation, while 58% of Hong Kong investors are also concerned about inflation.
Asia anxieties
Despite the majority of Apac investors being optimistic about the stock market for the next six months, 45% are “extremely or very concerned” about market downturns.
Covid (52%) and inflation (52%) rank as the top concerns among Apac investors, with other concerns including: climate change (50%), long-term competitiveness of respective markets (49%) and tax increases (47%)
Top portfolio changes considered by Apac investors include: 49% intend to add portfolio hedges, 47% of respondents will reduce bonds, 46% will add stocks, 45% plan to reduce cash and 42% will increase borrowing. Apac investors see technology (58%) and healthcare (56%) as attractive sectors.
On the other hand, 74% of Apac investors have more than 10% of their portfolios in cash, and of those, 53% are waiting for the right opportunity to invest.
“With the effects of Covid-19 expected to impact the healthcare industry for years to come and a shift to a more digitalised world, investors see further opportunities in these sectors,” Iqbal Khan, president of UBS Europe, Middle East, and Africa and co-president of UBS Global Wealth Management, said in a statement.
“However, given high levels of inflation and interest rate hikes on the horizon, investors are waiting for the right moment to put their money to work,” Khan added.
