Economies around the world are now steadily reopening from what has been widely described as an “induced economic coma”. Their recoveries are underpinned by assertive monetary easing policies, including central bank balance sheet expansion and credit support, together with fiscal stimulus packages that have been inventive and unprecedented in scale. However, the optimistic and partly liquidity driven equity market narrative met some resistance in June, which brought with it a rise in volatility and a more circumspect tone. Japan’s broad market rebound effectively hit the ceiling in June as the TOPIX ended fractionally lower, losing 0.2% on the month.
The case for investing in Japan has always relied on its many world-leading companies. In times of heightened uncertainty and acute economic stress, we believe quality companies that are adaptive, resilient and innovative will emerge even stronger. This pandemic will test their competitiveness, but those true winners will continue to reign. From a growth portfolio manager’s perspective, our objective is to identify these winners in the Japan equity market that are adapting and strengthening their businesses under challenging conditions.
We are pleased to publish our first dedicated Impact Report, which outlines the progress our Global Sustainable Equity Fund has been making through its investment and engagement with companies that we feel have the greatest total positive impact on society.
While Europe and the USA are suffering massively from the coronavirus crisis, many Asian countries are already further ahead in terms of the outbreak’s progression and their containment measures. We asked our Senior Investment Specialist Min Feng whether the Asian markets can continue to outperform over the next few months.