Eurozone crisis is biggest concern to Middle East intermediaries
The biggest concern for global financial markets among Middle East intermediaries is the ongoing eurozone crisis, according to the latest annual poll of advisers by Invesco Asset management Limited.
The poll was conducted in February during Invesco’s seventh annual Dubai Investment Meeting, attended by 238 intermediaries. Besides the eurozone concern, however, optimism about growth prospects for the global economy has increased.
Over half (56%) of the respondents felt positively or very positively about global economic growth prospects for 2013, compared to 38% in 2012. The most favoured asset class for the year ahead is equities (54%), followed by property (20%). The results tie in to the cultural preference of investing in tangible assets – and bonds (19%), the firm said.
Advice is still clearly in demand, as the poll indicated that a third (34%) of intermediary clients are unsure what to do with their portfolios in current market conditions, while over a third (36%) have chosen to make no changes.
Nick Tolchard (pictured), head of Invesco Middle East commented: “The outlook for global economic growth among intermediaries is encouraging and suggests a shift in sentiment despite the continuing reverberations of the Arab Spring.”
“However, what these results also show is that there is no clear view among clients and furthermore, many are unsure how to manage their portfolios in the current investment climate. This is an opportunity for the advisory community to speak to clients about their current asset allocation and their options in the current market environment.”
Other concerns among those polled were central bank policies (20%) and fiscal tightening in the US (20%). Geopolitical uncertainty and tension, paramount in the Middle East in 2012, is a concern for less than one in five (17%) intermediaries and professional investors.
“What this shows is the eurozone crisis is not just impacting Europe, but it continues to have a ripple effect across wider areas including the Middle East,” notes Tolchard.
Intermediaries in the region represent a diverse client base including Non-Resident Indians and Gulf Cooperation Council (GCC) locals, who we know from our annual study, exert a strong home market bias in their investment preferences, so it is interesting that the eurozone is still a key concern for these advisers.”
Invesco opened its Dubai office in 2005, and has been working with Middle East clients for decades, offering financial institutions and investment professionals access to global investment expertise.