HSBC upgraded Malaysia to Overweight from Neutral

SINGAPORE: HSBC has upgraded Indonesia, Malaysia and the
Philippines, while keeping its 'neutral' rating on Singapore and
'overweight' call on Thailand.
HSBC raised Indonesia to
'overweight' from 'neutral', noting that domestic demand and less
competition will help sustain the highest return on equity in the
region. Indonesia's market is "unloved" with potentially positive
growth surprises, it added.
Malaysia will benefit from strong
economic growth coupled with low inflation, HSBC said, adding that the
country has defensive and stable characteristics, high yield and is
likely to benefit from stimulus before the elections late this year.
HSBC upgraded Malaysia to 'overweight' from 'neutral'.
After
a long period of under-investment and political turbulence, the
Philippines is catching up fast, HSBC said, upgrading the market to
'neutral' from 'underweight'. But it said valuations are looking
expensive.
HSBC said Singapore is one of the more stable,
developed Asian markets with high dividend yields and very low earnings
volatility. However, it added, mutual funds have aggressively bought
Singapore equities in the last three months, raising the risk of a
sell-off. It remained neutral on the city-state.
HSBC maintained
its 'overweight' call on Thailand, saying the country offers a
structurally strong growth story. "Valuations are reasonable, there's
the possibility of a near-term growth surprise, the dividend yield is
attractive and political risks are easing."
Thailand and the
Philippines are among the best performing markets worldwide so far this
year, up 22 percent and 19 percent respectively. - Reuters