Threadneedle's Burgess sells down EMs in favour of Japan

Threadneedle's chief investment officer Mark Burgess explains why he is selling down emerging market equities and moving from underweight to neutral on Japan.

We are increasing our weighting in Japanese equities to neutral. We believe there will be material upward revisions to corporate profits, driven by the exporters, as Japan benefits from improving global growth, and in particular a more positive outlook for the US economy. Valuations are in line with other world equity markets, but arguably are at a reasonable discount once the cash on corporate balance sheets is taken into account. The bull case would be much stronger were corporates ever to behave in a more shareholder friendly fashion, but there appears to be no prospect of that i...