November 3, 2015 / 11:52 AM / 2 years ago

Barings AM upgrades equities exposure on U.S. optimism

LONDON (Reuters) - Baring Asset Management upgraded equities to "preferred" from "neutral" on Tuesday, citing higher expected economic growth in the U.S economy.

The group also upgraded British equities and energy to "neutral" from "not preferred," and kept European equities unchanged at "strongly preferred.

The asset manager, which has around $5.7 billion of assets under management in global multi-asset strategies, said worries over a stalling U.S. economy, driven by uncertainty over whether the Fed will lift interest rates and a slump in manufacturing, were overblown.

Barings said there was "little to worry about" with the U.S. economy and it expected higher growth and improved earnings per share in the first half of 2016. This would be enough to avoid dipping below the "stall speed" of 2 percent growth, it said in a statement.

"As usual, earnings growth and valuations will determine the path for markets in 2016. While certain equity markets are priced for perfection, others still offer a good upside," the group's Chairman Marina Valensise said.

Reporting by Angus Berwick; Editing by Lionel Laurent/Jeremy Gaunt

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