“Moreover, the sector’s relative valuations are attractive. Regional banks have also improved their balance sheets to meet Basel III requirements. Several Indian state-owned banks are also more cushioned from rising non-performing assets after the government’s capital injection earlier this year. We also like select Singapore banks that are exposed to regional growth,” Sadhwani said.
 
In the case of IT and industrials, Sadhwani said lower interest rates “are supportive of capex cycles and R&D spend in sectors such as technology”. 

“We like the internet leaders in China as well as tech manufacturers in Taiwan. Over 50 per cent of the MSCI Taiwan index comprises of technology companies – which means if global economic recovery accelerates, Taiwan could benefit more broadly. Select industrials/materials across China and Singapore can also be considered. China’s latest manufacturing surveys and export numbers have showed slower declines, indicating a bottoming of activity. Singapore’s open and export-oriented economy should also benefit from a pick-up in global demand and/or any domestic easing,” she said. 

Turning to South Korea, Sadhwani said the country is a way to play views on the state of the global economic cycle. “At 53.9 per cent, South Korea’s exports as a share of GDP is the highest in the G20 group of economies (as of 2013, Quandl data) making it highly sensitive to changes in global demand / trade. Korea is well poised to benefit as global growth gathers pace in 2016, despite some loss of competitiveness to a weak Japanese yen,” she said.

“Interestingly, the Institute of International Finance also notes that fund investors increased their Korea portfolio weights in the third quarter. We expect the Bank of Korea will likely keep an easing bias over the next six months given the low growth and inflation backdrop, although high household debt levels will need to be monitored,” she continued.