Brokerages Upgrades Asian Stocks in 2010

Goldman Sachs Most ‘Upbeat’ on Asian Stocks in 2010
(Bloomberg) -- Asian stocks may offer returns of 36 percent in dollar terms next year, helped by growth in emerging markets, Goldman Sachs Group Inc. said in the most optimistic of three brokerages’ reports on the region’s equities in 2010. The MSCI Asia-Pacific excluding-Japan Index may gain to 540 by next December, while the MSCI Asia excluding-Japan Index may rise to 650, Goldman Sachs analysts led by Timothy Moe wrote in a report dated yesterday.Goldman Sachs is more bullish than BNP Paribas and Citigroup Inc., which predicted gains of between 9 percent and 20 percent for Asian stocks next year, according to reports received today. The brokerage has also turned more positive in the past month, when it predicted a “sluggish” performance for regional markets next year amid slowing economic indicators and after a rally from their March lows lifted valuations.

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Asian Stocks to Gain 20% as Inflows Rise, BNP Says
(Bloomberg) -- Asian stocks may extend their best annual rally in 16 years, with a regional index poised to gain 20 percent in 2010 as foreign fund flows into the region’s equities increase, BNP Paribas said.The MSCI Asia excluding Japan Index may rise to 570 in the next 12 months, compared with the Nov. 27 close of 455.15, as inflows rise 30 percent to $35 billion, BNP strategists led by Clive McDonnell wrote in a report today. Singapore was raised to “overweight” from “underweight,” while South Korea was cut to “neutral” from “overweight,” according to the report.

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China Stocks to Rise on Economy, Mirae, Citigroup Say
Chinese stocks will rebound from their worst week in three months and keep rising next year as the strengthening economy lures more funds from overseas, Citigroup Inc. and Mirae Asset Global Investments Co. said. China is on course for a “long-term, multi-year bubble that’s not going to burst in 2010,” Citigroup Inc.’s head of China research Lan Xue told reporters in Hong Kong today.

Morgan Stanley Sees 5% Drop in European Stocks by End of 2010
(Bloomberg) -- European stocks may fall as much as 5 percent by the end of 2010 as governments withdraw stimulus measures, according to Morgan Stanley strategists. Shares may extend the rally in equity markets since March to as high as 1,200 for the MSCI Europe Local Index next year before falling to 1,030, the team led by the European head of equity strategy Teun Draaisma wrote in a report to clients today. Morgan Stanley continues to prefer stocks over fixed- income investment, they wrote.

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Asian Stocks May Rise 29% in 2010, Credit Suisse Says
(Bloomberg) -- Asian stocks may rise a further 29 percent in the next 12 months because the region is still undervalued and corporate earnings will continue to recover, according to Credit Suisse Group AG. The MSCI Asia excluding Japan Index may climb to 600 in the period, Credit Suisse analysts led by Sakthi Siva said in a report dated yesterday. They said investors should “overweight” South Korean, Indonesian, Indian and Hong Kong- traded Chinese shares, and favor so-called cyclical stocks over defensive shares.

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