The most attractive growth opportunities will emerge in the Unites States and Asia in 2017, said HSBC Private Bank’s 2017 Investment Outlook report on Wednesday.
Within the global equity portfolios, HSBC Private Bank is overweight on U.S. and Asian equities as it sees better growth opportunities in the two markets as compared to Europe which is plagued with structural challenges and political uncertainties, it said.
“Investors are confronted with two major structural challenges in 2017: the political uncertainty in Europe and Britain, and the increasingly uncertain global trade environment,” said Fan Cheuk Wan, head of Asian Investment Strategy at HSBC Private Bank, urging a disciplined and selective investment approach.
She said within Asian equities, HSBC Private Bank is overweight on China, India and Indonesia for their robust domestically-driven economic growth, structural reform tailwinds and pro-growth policy support.
Compared to their Asian and Organisation for Economic Co-operation and Development (OECD) peers, the three countries have a lower-than-average dependency on exports and their strong domestic focus should also make them less vulnerable to potential increases in trade barriers and fluctuations in global risk appetite, she said.
She forecast that demographic shifts and technological innovation present opportunities even in a low-return world and challengers are likely to emerge as winners.