Research  
BRIC Markets Outperformed in Jan 2012 February 8, 2012
The Fundsupermart Indices - All Equity advanced 2.3% month-to-date as at 31 January 2012. The top 5 funds were mainly those with significant exposure to BRIC; bottom 5 funds were mostly Malaysia funds.
Author : Fundsupermart Content and Research Teams


FSMI - All Equity January 2012

Key Points:

  • FSMI advanced 2.3% in January 2012
  • Top 5 funds were Mainly Those With Significant Exposure to India
  • Bottom 5 funds were Mainly Malaysia Funds

During the month of January, the MSCI AC World Index was up 1.7% (in RM terms) as markets worldwide rallied on hope that Europe will see positive developments in its debt crisis while economic data coming out of US, Europe, Japan, China, India indicated continuing economic recovery. Consensus estimates on Bloomberg put US and Europe's 2012 economic growth at 2.3% and -0.5% respectively (as of 7 February 2012).

Among the top performers in January were the BRICs, as the BSE SENSEX 30 (India), Brazil Bovespa, Russian RTS and Hang Seng Mainland 100 (China) indices gained 14.7%, 13.5%, 9.8% and 7.0% respectively (all in RM terms). During the month, the FSMI - All Equity index advanced 2.3%.

Table 1: FSMI - All Equity Performance
Date
FSMI - All Equity
Returns
Returns
(month-to-date)
(year-to-date)
30-Jun-11
1,572.5
-0.3%
2.8%
29-Jul-11
1,557.7
-0.9%
1.8%
31-Aug-11
1,430.8
-8.1%
-6.5%
30-Sep-11
1,353.0
-5.4%
-11.6%
31-Oct-11
1,447.7
7.0%
-5.4%
30-Nov-11
1,433.3
-1.0%
-6.3%
31-Dec-11
1,465.9
2.2%
-4.2%
31-Jan-12
1,499.7
2.3%
2.3%
Source: Fundsupermart.com compilations, as at 31 January 2012. Performance figures in the table are in RM terms, calculated using NAV prices, with any income or dividend reinvested.

 

BRIC Rebounds

Stock markets of the BRIC countries (FTSE BRIC 50 index) have rebounded and are close to early-August 2011 levels, driven by favourable economic data coming from major trading partners Europe and US and accommodative monetary policies in these two regions. While we like the BRIC region enough to accord a minimum rating of 4 stars "Very Attractive" to their stock markets, investors will need to know these markets were among the hardest hit when investor sentiments turned sour in 2011. Currently, these markets present attractive investment opportunities and we recommend investors to invest regularly bit by bit.

Meanwhile, Malaysian small caps benefited from rotational play as the benchmark FTSE Bursa Malaysia Small Cap Index gained 8.4% during the month, while selected companies in the tech, auto and plantation sectors did particularly well. On the currency exchange front in the month of January 2012, the RM strengthened against the renminbi, US dollar, Indonesian rupiah and yen by 4.2%, 4.2%, 3.1% and 2.8% respectively. At the same time, the RM weakened against the Indian rupee by 3.2% (as of 31 January 2012).

Table 2: Top Five Equity Funds in January 2012
Top Five Equity Funds
Market/Sector
Return (%)
(month-to-date)
(year-to-date)
Manulife Investment - India Equity Fund
India
14.3%
14.3%
RHB - GS BRIC Equity Fund
BRIC
8.9%
8.9%
OSK-UOB China-India Dynamic Growth Fund
China India
8.8%
8.8%
OSK-UOB Asian Real Estate Fund
Asia excluding Japan; Property
8.8%
8.8%
TA Small Cap Fund
Malaysia; Small to Medium Companies
8.6%
8.6%
Source: Fundsupermart.com compilations, as at 31 January 2012. Performance figures in the table are in RM terms, calculated using NAV prices, with any income or dividend reinvested.
*Since inception 28 June 2011

 

Malaysia Floats Along

Malaysia (FTSE Bursa Malaysia KLCI) was the only negative performer in local currency terms for the month of January 2012, shedding 0.6%. This was led by the finance sector which shed 1.9%, mainly due to investors’ profit-taking ahead of Chinese New Year break as well as the European Union Summit Meeting on 30 January 2012. Inflation eased further from 3.3% in November 2011 to 3.0% in December 2011, suggesting that the inflation has peaked in June 2011. With inflationary pressure subsiding, maintaining a decent economic growth will become the major concern of Bank Negara Malaysia (BNM), and we expect BNM to cut the Overnight Policy Rate (OPR) by 25 – 50 basis points in 2H 2012.

Table 3: Bottom Five Equity Funds in January 2012
Bottom Five Equity Funds
Market/Sector
Return (%)
(month-to-date)
(year-to-date)
Prudential Equity Income Fund
Malaysia
-3.9%
-3.9%
RHB Dynamic Fund
Malaysia
-3.0%
-3.0%
AmOasis Global Islamic Equity
Global
-1.0%
-1.0%
RHB Malaysia DIVA Fund
Malaysia
-0.9%
-0.9%
Prudential Indonesia Equity Fund
Indonesia
-0.6%
-0.6%
Source: Fundsupermart.com compilations, as at 31 January 2012. Performance figures in the table are in RM terms, calculated using NAV prices, with any income or dividend reinvested.
*Since inception 11 January 2011

 

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