INDEPENDENT ADVISORS | Terry Gangcuangco, Hong Kong

Investor sentiment in Asia rises by 16% for Q1 2009

There has been a 16 percent increase in investor sentiment in Asia for the first quarter of 2009, according to the quarterly ING Investor Dashboard Survey.Compared to 73 for Q4 2008, the overall pan-Asia (ex-Japan) ING Investor Dashboard Sentiment Index rose to 85 for Q1 2009. Since the introduction of the Index in the third quarter of 2007, this is the first quarter-on-quarter increase in investor sentiment.Main drivers of investor sentiment in the region are China and India, both having strong upswing in Q1 2009 investor sentiment index scores. In China, 71 percent of investors said the government’s economic stimulus package to boost growth and domestic demand has a positive impact on the local economy. In India, the investor sentiment upswing could be attributed to the recovery from past corporate scandals and the Mumbai terrorist attacks.Alan Harden, CEO of ING Investment Management Asia/Pacific, said, "China and India have always been key to driving economies in Asia. In general, there is confidence the Chinese government will continue to step in to help support the economy where necessary. The recent economic stimulus package is a good example and coupled with a strong stock market, it is not surprising to see investor confidence rise. Bank loan growth in China has picked up, the Purchasing Managers' Index has risen above 50, and we believe there is evidence that the consumer is buying houses and automobiles. All of this is positive and the market remains buoyant."He added, "In the case of India, we are definitely starting to see investors bounce back from the global economic recession and the financial services crisis; as well as the local market shocks from the Satyam corporate scandal, particularly as Satyam attracted positive interest from overseas bidders."Investor sentiment remained fairly stable across the rest of the markets. As for Southeast Asia, investors in this region appeared to have been slightly more impacted by the global financial and economic crisis, likely due to the decrease in global demand for commodities and exports."Not surprisingly, the global financial and economic crisis is not something that China and India, the two growth engines in Asia, can solve alone. Many Asian governments have put in place good measures to ride out the current crisis but until the US and Europe start to recover, Asia will have to continue taking a prudent approach in dealing with market developments," Harden concluded.The ING Investor Dashboard is the first quarterly survey in the Asia Pacific region that provides a pan-Asia (ex-Japan) investor sentiment index. The survey is conducted quarterly across 13 markets in Asia Pacific. It allows each market to be benchmarked and tracked against the overall investor sentiment across Asia using the pan-Asia index, and it provides market insights on investor attitude and outlook.

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