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Investor risk appetite soars in Asia
While investors in the developed world rush for the exit, risk appetite among Asian investors surged to a new high in October, according to State Street’s latest Investor Confidence Index report (pdf).
“The Global ICI decreased to 114.3, down 2.3 points from September’s revised reading of 116.6. The decline in sentiment was driven by a decrease in the North American ICI from 133.2 to 125.5 along with the European ICI falling 5.8 points to 89.9. By contrast, the Asia ICI rose by 13.2 points to 111.0.”
The asset manager’s Ken Froot says that this is the first time the Asia ICI climbed above the 100-point threshold this year, an interesting data point given that Shanghai and Shenzhen were on full-on risk mode during the first eight months of the year.
The main reason for the surge? Cheap money and SOE reforms, apparently:
“[T]he increasingly accommodative stance taken by policy makers globally and hopes for state-owned enterprise reforms in China have had a large impact on Asian investors, boosting risk appetite by 13.2 points.”
With the Fed back at square one and the fifth plenum supposedly focused on reforms, these guys must be having a ball now.