Hong Kong is regaining favour among fund managers as they become more optimistic about where stock markets are heading, the latest monthly survey by Merrill Lynch shows.
The SAR market scored a net zero of fund managers who like it against those who dislike it in the survey conducted early this month. This is better than the net 5 per cent of fund managers who disliked it last month and a net 21 per cent in September.
'Higher beta markets such as Hong Kong and Taiwan swung back into favour,' Merrill's regional strategist Spencer White said.
Perhaps helped by a global equity rally which began on October 10, fund managers struck a more positive note than they had a month earlier, Mr White said.
'The perceptions of fund managers have made a radical 180 degrees shift,' he said. 'Earnings expectations are higher, risk appetite has expanded further and sector allocation has become much more cyclical in nature.'
South Korea and China had a net 19 per cent of fund managers liking each of them while Thailand had a net 15 per cent.