Eastspring's Gibson: 'EM quality bubble starting to burst'

Value stocks beginning to outperform

Tom Eckett
clock • 1 min read

Kevin Gibson, CIO, equities of Eastspring Investments, has said the quality bubble in emerging markets (EM) equities is starting to burst with value stocks beginning to outperform once again.

Speaking to Investment Week, Gibson (pictured) said there was a "unique opportunity" in emerging markets as investor sentiment towards the asset class and value stocks has been broadly negative over the past few years, thanks to capex building up in EMs, particularly in China, and the fall of commodity prices. This has led to 'quality' stocks performing extremely well as investors sell out of more cyclical names. Have emerging markets passed an inflection point? Gibson said: "The value dispersion has been extremely wide as a function of the Fed, QE and bond proxy stocks performing ...

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