BSE Sensex seen rising 20% by end-2011: Poll

The sensex will rise to 23,350 by end-2011 from close of 19,696.48 on December 8, according to the median response in a poll taken from 18 market participants, which include investment banks and brokerage firms.

World stocks set for best Dec performance in a decade

World stocks clung near two-year peaks while oil rose towards the $92 per barrel mark this week after yet another burst of strong economic figures from the United States encouraged some year-end buying.

The latest rally in major European and U.S. stock indices has given investors the biggest December gains in more than a decade.

Expectations of strong U.S. fourth quarter performance was further cemented by latest data which showed demand for durable goods rising and consumer spending picking up.

A slew of strong numbers coming out of the world's biggest economy in recent weeks has given global growth bulls another reason to cheer and boosted commodities and stocks.

Reflecting that growing optimism, the Asia Pacific-ex Japan shares for energy shares advanced slightly while other indexes were broadly flat to slightly lower.

Trading was thin and prices confined in narrow ranges in Asia, with many centers on holiday in thin year-end markets. U.S markets are also shut along with many European centers.

World stocks as measured by the MSCI extended gains by nearly 6.5 percent so far this month while the Asia-Pacific version was largely unchanged.

"In the U.S., fears of a double dip recession have receded considerably with the extension of tax relief agreed in December and a second round of quantitative easing in November," Fitch Ratings said.

" High frequency activity has also turned more positive, reflecting strength in private consumption and corporate profitability."

That has made investors more sanguine towards developed markets.

Latest EPFR data showed developed markets equity funds posted their longest fund inflow streak since the fourth quarter of 2009 at the expense of emerging markets equity funds.

Investors enter 2011 in bullish mood - Reuters poll

Investors are entering 2011 in a relatively bullish mood, raising equity holdings to a 10-month high, increasing exposure to high-yield credit and cutting back on government debt, Reuters polls showed yesterday.

Within bond portfolios, however, concern about the cost of U.S. Treasuries and the stability of euro zone debt, did not show up dramatically.

Allocations to emerging market debt were cut instead.

Surveys of 55 leading investment houses in the United States, Europe ex UK, Japan and Britain showed investors holding 54.1 percent of a typical mixed-asset portfolio in stocks in December.

That was up from 53.2 percent in November and the highest since 55.4 percent in February.
Bonds were cut to 33.9 percent, the lowest since February, from 34.2 percent in November. Cash was at 3.9 percent, down from 4.6 percent.

A combination of improving economic data and a belief in future, robust, corporate earnings has lifted investor appetite for equities over the past few months. The MSCI all-country world stock index was flirting yesterday with levels last seen in September 2008.

"People are coming off the sidelines and buying stocks," said Keith Wirtz, president and chief investment officer at Fifth Third Asset Management in Cincinnati.

There was also sign of risk appetite in an increased exposure to riskier, higher yield bonds.
At the same time concerns have risen that yields on benchmarket government bonds are too low, providing little return and threatening a sell-off.

Investors in the Reuters polls did cut back overall exposure to bonds. But when it came to the money left for bonds they favoured U.S. and euro zone government debt over most emerging markets, which have been very popular this year.

Exposure to emerging market debt was 8.1 percent of a bond portfolio for the month, compared with 9.6 percent a month earlier.

Investors also regained some composure about euro zone government bonds following the crisis over Ireland's debt. They raised exposure within a bond portfolio to 31.5 percent from 31.2 percent, although these numbers remain well below the more than 42 percent seen at the beginning of 2010.

REGIONALLY

U.S. fund managers built up their equity holdings in December to one of the highest points this year on signs of a swifter economic recovery.

The poll, which surveyed 13 U.S.-based fund management companies, showed firms boosting their equity allocations for the fourth month in a row to an average of 65.0 percent, two percentage points over November.

The Reuters poll also showed money managers scaling back their exposure to bonds for a fourth consecutive month, to 27.9 percent of their portfolios in December, compared with 30.2 percent last month.

Japanese fund managers held on to most of their global stock weighting in the month and raised their bond allocation to the highest level since September on the view that recent falls in bond prices were overdone.

The 13 respondents also lowered their cash position to the lowest level in more than a year.
Asset managers' average weighting for global equities in the Japanese poll fell only 0.1 percentage point from the previous month to 47.1 percent. The weighting for bonds rose to 48.3 percent in December from 46.9 percent last month.

European fund managers lifted equity holdings to a 11-month high and also boosted bonds.

The survey of 17 Europe-based asset management firms outside Britain released showed a typical mixed portfolio holding 50.1 percent in equities this month, compared with 49.6 percent in November.

It held 37.5 percent in bonds including government and corporate debt, compared with 37.3 percent last month. Cash holdings fell to 5.3 percent from 6.1 percent, hitting their lowest level since January.

British fund managers increased their exposure to equities, particularly domestic UK stocks, and cut back on bonds.

The survey of 12 investment managers showed the average allocation to global equities climbed to 54.2 percent from 52.8 percent.

Bond holdings dropped to 22.0 percent from 22.5 percent.

Exposure to UK stocks within equities jumped to 16.3 percent from 12.6 percent in November.

The blind investment banker with a vision....

Breaking records has been a way of life for this 30-year-old banker from Mumbai -- be it in life, at work or in sports. But he is a trader with a difference.

Ashish Goyal works for J P Morgan Chase as a chief investment officer and is passionate about macroeconomics and the financial markets. And Mr Goyal is blind.

A New York Times article says looking at Ashish work one can hardly figure out that he is visually impaired - the speed and accuracy with which he manages billions of dollars of the bank's exposure to risks like foreign exchange fluctuations.

Outside his official assignment, Ashish represented the Metro London Sports Club in 2009 in the United Kingdom's domestic blind cricket league. In his very first year, he became a prominent member of the team contributing to winning the UK league. His friends find it difficult to keep pace with his social life that ranges from theatre, music, charity work to Formula F1, tennis and globetrotting to 'watching' cricket matches.

Ashish, who was born with perfect vision, suffers from a disease called retinitis pigmentosa, which robbed him of his sight after the age of 15. He did not lose his vision at one go, but gradually went blind over a period of three years. By 18, he couldn't see anything at all.

He was the first blind student to make it to Wharton Business School, Philadelphia, four years ago. If that isn't enough, Ashish cleared his MBA with honours and went on to win the Joseph P Wharton award, given to one student every year who symbolizes Wharton's way of life.
Ashish, who now lives in London, is the first blind trader at J P Morgan, and possibly in any bank anywhere in the world. His near-impossible feat has earned him the National Award for the Empowerment of Persons with Disabilities, 2010, an honour that he will receive at the hands of the President of India this week.

Ironically, while Ashish will return to India to receive his award, this country has been a trifle hostile to him during his first attempt at entering the job market. He had a tough time getting a job in India, despite securing a second rank in his batch while doing an MBA at NMIMS.