Asian share valuations will likely fall until the middle of this quarter but will thereafter start to bounce back, according to analysis from Kestrel Investment Partners.
The London-based investment manager says that equity valuations in Japan, South Korea and Taiwan will continue to lack support as worldwide export demand lessens with decelerating global consumption growth.
In addition, lower industrial activity in Asian economies will weigh on top-line corporate revenue expectations.
According to Kestrel’s modelling, slowing growth in the US will increase downward pressures on share valuations in economies such as Japan’s.
John Ricciardi, Kestrel’s chief executive, said: “We expect Asian equities to find their floor by the middle of Q3, at which point we will be looking to add positions in Japanese, South Korean and Taiwanese stocks.”
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