Director’s Cut -- Yes, we are still bullish on Korea ::Macquarie Research,

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Director’s Cut
Yes, we are still bullish on Korea
Since early 2011, Chan Hwang set his KOSPI target at 2600, which is one of
the highest targets on the street. With the recent softening in economic data
many investors have asked if he is still bullish, and he says the answer is yes.
In his view, the global economy is in a transition period, moving from corporate
spending to consumer spending. He thinks the KOSPI is well leveraged to this
cycle due to its export orientation, adding that gradual currency appreciation
against the US dollar is likely to provide additional gains for investors.
Chan’s Korea portfolio has outperformed MSCI Korea by over 300 basis points
year to date. Moving forward, he is overweight autos, refinery, chemical,
construction and shipbuilding, and underweight telecom, utilities and steel. In
terms of stock picks, the new ones added to his portfolio are Kia Motors (00270
KS) and GS Holdings (078930 KS), which offer forecast 12 month TSRs of 18%
and 30%, respectively. >> Read Report
After updating the Macquarie Country Alpha Model, David Rickards
highlighted Korea as one of two countries expected to benefit from a second half
rebound in equity markets (Germany was the other). This provides a second
reason for believing Korea is an attractive market.
Highlights
 Richard Gibbs thinks Australian interest rates are close to their cyclical peak,
suggesting stocks with high equity duration may outperform.
 In China sportswear, Linda Huang has a conviction buy on Anta Sports
(2020 HK), and a conviction sell on Li Ning (2331 HK).
 Jal Irani thinks Reliance Industries (RIL IN) is cheap, arguing at the current
price you get the upstream business almost for free.
 Kevin Smithen has downgraded AT&T (T US) to Neutral due to increased
headwinds to wireless revenue growth.