Analysis

The Japanese market has been a laggard in the broad equity market recovery that began in March last year.

All but one of 142 funds in resurgent IMA peer group register positive returns over one year to 19 February.

The US economic recovery is well under way, but our estimate is lower than the consensus view.

A mid-cycle correction, which we anticipated for Q2 2010, may have already started and there is good reason for us to advise a more cautious approach within the Pacific Basin.

For many, high yield is nothing more than a niche investment. However, last year's impressive returns and increased issuance is bringing the attractions of this asset class to a much wider audience.

Concerns about a sovereign credit crisis in peripheral Europe drove equity markets significantly lower in the past few weeks, although corporate earnings results overall showed a solid improvement.

Investors are increasingly looking East as dividend culture of UK companies wanes, capping what was dubbed a ‘dismal decade' for UK shares.

Although our investment decisions are based solely on stock-specific valuations rather than any top-down view, it is hard to ignore the signs the global economy is improving.

The rally in equities, credit and commodities from March last year neatly fits the pattern of the market discounting an economic recovery six months ahead of the turn in the (backward-looking) data.

Six months ago, interest in Japanese stocks was at a very low level.