Tim Moe, Chief Asia Pacific regional equity strategist at Goldman Sachs, noted that North Asian markets, particularly Taiwan, South Korea, and Japan, are benefiting from stronger fiscal capabilities and a focus on AI developments, with tech stocks comprising a large portion of their indexes.
South Korea's Kospi index has surged over 80% year-to-date, while South Asian markets, particularly Indonesia, are struggling due to energy vulnerabilities and lack of tech presence, with a reported 25% decline. Moe expressed caution regarding South Korean semiconductor stocks, which are trading at low earnings multiples, indicating skepticism about their long-term profitability.
In China, A-shares have outperformed H-shares, reflecting positive economic signals after a prolonged period of deflation. However, Moe warned of potential corrections in the market due to looming energy supply shocks, emphasizing the need for investors to remain vigilant