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PrintOct 15, 2009
- Emerging markets bull run has only just started.
London 15th October 2009: Speaking at the latest J.P. Morgan Asset Management Guide to the Markets seminar, Richard Titherington, CIO of the Emerging Markets Equity Team and Portfolio Manager for JPM Emerging Markets Infrastructure Fund outlined the long-term investment case for emerging market equities:
“Emerging markets represent 50% of the world’s economic activity today, but only 12% of global market capitalisation. However with booming populations and growing spending power we anticipate a far greater correlation between these two numbers in the next five to 10 years, revealing the potential of these countries.
“This convergence between market capitalisation and economic activity can be expected from looking at the facts we see today. Countries such as Russia with its ongoing retail revolution and China which has committed $20 trillion to infrastructure development are going through exactly the same growth and development process which the UK went through in the Industrial Revolution. Growth premiums of 4-5% year on year versus developed markets are likely, underpinned by economic development and higher levels of urbanisation, industrialisation and infrastructure development. Governance and regulation are also evolving with Brazil’s introduction of interest rate independence over a decade ago, and Turkey’s fully restructured banking system serving as prime examples.
“Naturally demographics play a part in this development, and with 94% of new labour force entrants coming from emerging markets, this growing supply of workers is likely to become a major factor in driving these countries’ growth. This leads us to expect returns over the next 2-3 years to be primarily supported by earnings which are only set to grow.”
Guide to the Markets is a quarterly interactive event, designed to support IFAs by keeping them informed about world markets and ultimately provide the rationale to help them optimise their investment recommendations. The seminar is hosted by J.P. Morgan Asset Management’s in-house global strategist Tom Elliott. It is followed by a fund or sector specific presentation with Emerging Markets being the focus at the latest event. Within the last year alone, over 1600 IFAs have attended the Guide to the Markets events which took place in 16 towns and cities nationwide. IFAs can register for the next JPM Guide to the Markets by visiting: http://www.jpmorganassetmanagement.co.uk/adviser/MarketInsights/GuideToTheMarkets/
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For further information please contact:
J.P. Morgan Asset Management
Benjamin G. Larter
Telephone: 020 742 2112
Email: benjamin.g.larter@jpmorgan.com
Lansons Communications
Caroline Macleod-Smith
Telephone: 020 7566 9702
Email: carolinems@lansons.com
Notes to Editors
J.P. Morgan Asset Management is part of J.P. Morgan Chase & Co. and is a global asset management leader providing world-class investment solutions to clients. With US$1.1 trillion in assets under management (the Asset Management client funds of J.P. Morgan Chase & Co. as at June 30th 2009) and offices in 40 locations around the world, J.P. Morgan Asset Management offers global coverage with a strong local market presence, and leadership positions in most asset classes.
J.P. Morgan Asset Management is a trading name of JPMorgan Asset Management Marketing Limited which has issued this material in the United Kingdom and which is authorised and regulated by the Financial Services Authority. Registered in England No. 288553. Registered office: 125 London Wall, London EC2Y 5AJ.
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