BARING Asset Management remains overweight in Hong Kong, saying the territory is due for a cyclical recovery and predicting it will offer an average annual return of about 20 per cent this year.
Hong Kong's exports were growing at a steady 15 per cent, Baring's Henry Ho told an investment seminar yesterday, and there was evidence of economic improvement.
While there were no signs of a formal easing in China's austerity drive, there were hints of some relaxation, which should have a flow-on effect on Hong Kong, said Mr Ho, who covers Southeast Asia for Baring.
There also were signs of stronger demand in the upper end of the territory's property market. In the primary-mortgage market, sales previously had been going at a discount, he said.
But he noted that triad activity at auctions appeared to be reviving.
However, there was reason to believe that Hong Kong's property market still would see a fall in terms of new units flowing on to the market.
From a recent historical average of 30,000 units, the supply would ease to 20,000 in 1997, Mr Ho said.
