Reply #20: UBS Cuts Target for Asia Stocks as Data Signals Regional Economies Slowing [View All]

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http://www.bloomberg.com/news/2011-09-02/ubs-cuts-asia-stock-target-on-slowdown.html

UBS AG cut its estimate for a gauge of Asian stocks, excluding Japan, as equities remain “broadly out of favor” amid slowing economic growth and a lack of easier monetary policies.

The MSCI Asia excluding Japan Index’s year-end target was cut to 580 from 670, Niall MacLeod and Aakash Rawat, analysts at UBS, wrote in a report dated today. They said they prefer China and India because global growth weakness should help ease inflation concerns, while they kept an “underweight” rating on Taiwan and South Korea.

“We still expect weak data, little relief from central banks in terms of major fresh policy action, but that ultimately the weak patch in data will ease into the fourth quarter,” the analysts wrote.

MSCI’s Asia ex-Japan measure lost 0.9 percent to 510.76 at 11:32 a.m. in Hong Kong, snapping a four-day, 5.5 percent increase. The gauge slumped 10 percent last month, the most since October 2008, amid concern global economic growth is slowing as Europe’s sovereign debt crisis spreads and after Standard & Poor’s cut its rating on U.S. debt.