Invesco’s Kristina Hooper sees significant opportunities in areas shunned by most investors.
Despite the new wave of omicrons, she lists emerging markets – including China – as the top places to work in 2022.
The company’s director of global market strategy told CNBC: “We’ve always known that emerging markets are going to take longer to get vaccinated. But it’s clear that there’s an upswing happening and it’s happening. will continue well into 2022”Trading country“in Monday.” So that means 2022 should be for emerging markets, 2021 for developed markets in terms of participating in a stronger reopening of their economies. “
So far this year, iShares MSCI Emerging Markets ETF, which tracks large and medium-sized publicly traded companies in developing regions, is performing significantly worse than S&P 500. The ETF is down 6% so far this year while the S&P 500 is up 24%.
Hooper admits it is courageous to invest abroad in places such as China.
“The conventional wisdom is that China can’t invest,” said Hooper, who is particularly bullish on the country’s tech industry. It is not impossible to invest.”
Chinese lawmakers are in the process of cracking down on major regulations as part of the “commonwealth” push. Beijing regulators are seeking more control over industries including technology, games, e-commerce and education.
‘It’s a real play of contrasts’
“Regulations have been targeted at specific sectors that are in sync with the Chinese government’s long-term policy goals,” she said. “We’re closer to the end of any major regulatory series than we were at the beginning. This is a buying opportunity a lot. I think it’s a real game of contrasts.”
Going mainstream, Hooper is also bullish on US equities. So far, she’s not too worried about new strain of Covid-19 omicron here as well.
“This seems very contagious, but it’s very mild. And so it shows that we are unlikely to see lockdowns,” she said. “The metric to follow right now in the absence of lockdown… is mobility. And, mobility is virtually unaffected when individuals are out and about, engaged in shopping. [and] restaurant. “
Hooper believes that Federal Reserve policies will also not derail the risk-taking environment.
“The US is likely to see a deceleration in its economy as the Fed starts to tighten and of course, as we see the fiscal stimulus removed,” Hooper noted. note. “We are likely to remain above the trend in terms of growth.”
And, that’s where Hooper’s prospects take another turn. One of her big calls including cyclical US tech stocks. According to Hooper, there is a widespread assumption on Wall Street that technology is a safer asset class.
“We could certainly see cyclical indicators perform better in the shorter term with what I would expect to be a strong December,” Hooper said. “But I believe that for most of 2022 we will see secular developments [and] guard, especially technology, works better. “
Heavy technology Nasdaq has increased 20% so far this year and 125% since the pandemic was low.
