Banks Predict Emerging-Market Rally as Ashmore to Pimco See ‘Cheap’ Stocks

According to Bloomberg strategists and money managers at some of the biggest banks and investment firms are forecasting gains for emerging-market stocks (MXASJ) next year, driven by low valuations and signs that governments will act to boost growth.
Morgan Stanley’s Jonathan Garner lifted his recommendation to “maximum overweight” for the first time since October 2008, according to a report today. Citigroup Inc.’s Markus Rosgen said Asian stocks may surge 30 percent, while Credit Suisse Group AG’s Sakthi Siva predicted 10 percent gains. Antoine van Agtmael, who coined the term “emerging markets” in 1981 and now oversees $7.4 billion at Ashmore EMM LLC, said the stocks are “cheap.” Pacific Investment Management Co.’s Masha Gordon has been buying equities most reliant on economic growth.

“Emerging markets as a group are now as attractive as I have seen them on both a historic and comparative basis at any time in the last 25 years,” van Agtmael, a former World Bank official and author of “The Emerging Markets Century,” said in a Nov. 29 phone interview. “I see 2012 in emerging markets as a year of positive investment returns, positive economic growth and positive earnings growth.”

http://www.bloomberg.com/news/2011-12-02/banks-predict-emerging-market-rally-as-ashmore-to-pimco-see-cheap-stocks.html