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Contrarian Case Says U.S. Growth Slowdown a Boon for Asia Stocks

  • Covenant Capital manager sees rest of world catching up
  • Lim is overweighting Asian equities and underweighting Europe
Final Trading Day Of The Year At The Tokyo Stock Exchange
Photographer: Kiyoshi Ota/Bloomberg

There’s at least one bullish way of framing U.S. economic growth slowdown concerns: It could benefit Asian stocks.

So says Edward Lim, a fund manager at Singapore-based Covenant Capital Pte. His rationale is that while the U.S. isn’t entering a recession, the difference between its economic growth, corporate profits and interest rates relative to the rest of the world has narrowed, which in turn will weigh on the U.S. dollar -- and bolster Asian stocks.