Japan fund managers raise stock weightings in March

TOKYO - Japanese fund managers raised their global stock weightings for the second straight month in March on prospects that share prices may hold up as governments across much of the world roll out fiscal stimulus steps.

By (Reuters)

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Published: Tue 31 Mar 2009, 10:43 AM

Last updated: Thu 2 Apr 2015, 7:46 AM

An easing of risk aversion and increased fiscal spending were seen weighing on bondrom 50.7 percent a month earlier and a 5 ½-year low of 49.8 percent in January.

“As the fiscal measures will play out their effects in each country, the pace of worsening in the economy will likely slow,” said Yuichi Kodama, chief economist at Meiji Yasuda Life.

“But an economic recovery will be slow-paced due to the credit crunch. We can’t expect share prices to have much upward potential.”

The poll showed bond allocations fell to 44.2 percent, from 44.8 percent the previous month and a decade high of 45.7 percent in January.

“The outlook for the global economy remains gloomy, although global share prices may rise temporarily over the next month in reaction to overselling since the beginning of the year and to fiscal steps unveiled by each country,” said Kiyoshi Ishigane, a senior strategist at Mitsubishi UFJ Asset Management.

“The bond market will be firm since the Federal Reserve announced Treasury bond buying,” he said of the Fed move to buy $300 billion in Treasury securities over six months, the first time it has bought longer-term government debt since the 1960s.

By region, fund managers boosted allocations for North American shares for the fourth straight month, following a slew of U.S. steps to combat the worst economic crisis since the 1930s. They reduced exposure to the euro zone, Britain, Japan, and other regions in Asia.

“The U.S. economy has continued worsening but the pace of deterioration is slowing. I wouldn’t be surprised if share prices rebound as they show the economy’s trend down the road,” said Junya Naruse, a senior strategist at Daiwa Institute of Research.

Within their bond portfolios, fund managers further cut their weighting for Japanese bonds to 21.0 percent, from 22.5 peVD STX FRX NEWS weighting for Japanese bonds to 21.0 percent, from 22.5 peVD STX FRX NEWS

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