Jon Bell portfolio manager of BNY Investments Global Equity Income Fund discusses with this news service why he favours a dividend-focused approach and why it’s important to look for investment opportunities outside the US.

Jon Bell (pictured) portfolio manager of BNY Investments thinks income stocks and a dividend focused approach offers better rewards globally, and says investors must seek opportunities outside the US.

Although the US economy has been performing well recently, Bell highlighted in an interview with this news service that US stocks are expensive and overvalued. The recent US tech sell-off after China’s DeepSeek claimed advances in artificial intelligence (AI) also created fear in the markets, he told this news service. As of the time of writing, indices such as the S&P 500 Index of US equities are down (the S&P 500 has fallen 5.9 per cent since the start of January), hit by worries about US President Donald Trump's tariff policy and uncertainties on how this will play out. 

BNY Investments Global Equity Income Fund is heavily exposed to the US, but Bell is underweight in the region. He is overweight in the UK, where valuations are cheap, and likes France, Germany and emerging markets. He is optimistic about the outlook in 2025.

Bell believes that dividend-paying firms are good, with better governance, so he is overweight in Taiwan and Singapore as they are bigger dividend payers.

China
Despite the fact that President Trump recently imposed additional tariffs on Chinese imports, Bell is looking to increase his exposure to China, as he believes that Beijing’s recent stimulus measures should have a positive impact, boosting the economy and business confidence.

The stimulus measures were largely in line with expectations for a more pro-growth agenda at the National People’s Congress (NPC) this month. HSBC Global Private Banking viewed China’s policy pivot towards technological innovation, consumption revival and private sector development, which was endorsed by the NPC at its closing session, as a positive driver supporting re-rating of the China equity market.

China set a GDP growth target of around 5 per cent for 2025, indicating the government’s pro-growth policy bias and determination to anchor market expectations of continued policy support to boost business and consumer confidence. The government highlighted boosting consumption as its number one priority for 2025, up from the number three priority in 2024. 

After DeepSeek’s breakthrough, Beijing also promoted extensive application of large-scale AI models under the “AI Plus” strategy at the NPC. This indicated China is doubling down on AI investments to enhance its global leadership in technological advancement. “Positive policy messages from the NPC reinforce our overweight position on China equities and China hard currency IG bonds,” Cheuk Wan Fan, chief investment officer, Asia, Global Private Banking and Wealth, HSBC, said in a note. “We see further re-rating potential in China equities, led by internet and technology stocks, due to the market’s distinctive AI re-rating driver, improving earnings expectations, compelling risk-reward profile underpinned by conservative foreign investor positioning and significant valuation discount.” 

Bell highlighted that he looks at good quality firms in China that are not so impacted by tariffs. China also exports less to the US and many Chinese firms have already accelerated their localisation strategy which should mitigate the tariff impact.

Wenchang Ma, China equites portfolio manager, and Alan Siow, co-head of emerging market corporate debt at Anglo-South African asset manager Ninety One, are also optimistic about investment opportunities in China in 2025.  

BNY Investments Global Equity Income Fund
Bell co-manages the Irish-domiciled BNY Investments Global Equity Income Fund which aims to achieve long-term capital growth by investing predominantly in equity and equity-related global securities. It measures its performance against the FTSE World TR Index.

The fund is heavily exposed to financials, followed by healthcare, consumer discretionary, industrials and consumer staples.

Top 10 holdings include US financial services specialist the CME Group, US tech multinational Cisco Systems and French pharmaceutical firm Sanofi. They also include US-Irish medical device firm Medtronic, US food multinational PepsiCo, and US coffeehouse Starbucks.