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<Research> M Stanley: Asia Ready to Capture Surge in Global AI Capex; Lists Latest Regional Thematic Focus Stocks
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M Stanley said in a report that Asia-Pacific equities continue to benefit from index tilts toward computing, commodities and capital goods. The surge in artificial intelligence (AI) capital expenditure is driving earnings growth for AI enablers, while the bank also sees broader capital spending programs spanning defense and economic security, creating opportunities in industrials and commodities. The report noted that Asia, with its upstream advantages, is well positioned to capture benefits from the global surge in AI capital expenditure, alongside the ongoing build-up in public spending on energy security and defense. By economic risk exposure breakdown, more than 50% of the weighting in Asia/emerging market indices comes from computing (semiconductors/hardware), commodities, capital goods and real assets. Earnings growth in computing remains strong, but valuations and positioning have also risen accordingly. The bank finds cyclical sectors attractive and, unlike peers, maintains an "Overweight" stance on the commodities sector, which also benefits from the capex supercycle and enjoys better valuation support relative to historical levels and other sectors. Meanwhile, the capital goods sector has solid long-term prospects, though M Stanley noted its median valuation is close to that of the computing sector despite lower three-year growth expectations. Strategically, the bank remains "Overweight" on the industrials sector and will continue to work with its key industry teams to screen for high-potential opportunities. M Stanley revised its Asia thematic focus list, adding four stocks and removing four, as follows: Additions | Sector Gulf Development PCL | Utilities Mitsubishi Heavy Industries (7011.JP) | Industrials FANUC (6954.JP) | Industrials Wiwynn (6669.TW) | Information Technology ----------------------------- Removals | Sector Reliance Industries | Energy Fujitsu (6702.JP) | Information Technology Grab Holdings | Industrials Goodman Group | Real Estate M Stanley's latest Asia thematic focus list includes: Taiwan Semiconductor Manufacturing (2330.TW) Samsung Electronics (005930.KS) TENCENT (00700.HK) CONTEMPORARY AMPEREX (300750.SZ) Delta Electronics (2308.TW) AIA (01299.HK) Mitsubishi Heavy Industries (7011.JP) NAURA (002371.SZ) Larsen & Toubro Ltd Doosan Heavy Industries (034020.KS) WUXI APPTEC (02359.HK) Hanwha Aerospace (012450.KS) FANUC (6954.JP) Hyundai Electric (267260.KS) INOVANCE TECH (300124.SZ) Wiwynn (6669.TW) Gulf Development PCL ST Engineering SIEYUAN ELEC (002028.SZ) Furukawa Electric (5801.JP) Taisei (1801.JP) Lynas Rare Earths Sojitz (2768.JP) GS Yuasa (6674.JP) GemLife Communities Group (da/u) Auto-translated by AI This article was automatically translated by AI, the original language version should be considered the authoritative version. AASTOCKS.com Limited does not guarantee its accuracy or completeness and accepts no liability for any damages or losses arising from the use of this translation. More Details
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