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Market Briefing

Emma Du Haney, Henderson Global Investors

EUROPE: Corporate bonds look good value

Corporate bonds, particularly the higher quality investment grade ones, look cheap on any historical measure. In the UK, investment grade financial sector bonds are trading at levels that indicate that one in five banks will go bust in the next five years.

Cormac Weldon, Threadneedle

NORTH AMERICA: Recovery may not be far away

The US economy has now been slowing for some time and there are mounting fears of a recession. However, we believe that by the end of 2008 the economy could already be on course for a recovery, as the lagged effects of the recent action by the Federal Reserve and the proposed fiscal stimulus package from the Bush administration feed through.

Urban Larson, Latin America Equity Fund, F&C

SOUTH AMERICA: Growth remains strong

Despite current market volatility, economic growth across Latin America is still strong and the region remains attractive for investors across the globe. Both public and private sectors have very ungeared balance sheets, while the region as a whole continues to run a current account surplus.

John Su, Goodman Property Investors

ASIA PACIFIC: Asian property will attract investors

As concerns continue to grow around the US economy and European property market returns slow, Asian property markets will increasingly be seen as an alternative destination for western investors.

Alice Breheny, Henderson Global Investors, Property

EUROPE: Growth in Italian retail property

Following the credit crunch of 2007, many parts of the European property market saw some correction during the latter half of the year, with secondary property taking the biggest hit. While higher yields present a buying opportunity, investors are now likely to take a more cautious approach to acquisition.

Tracey Lander, Old Mutual Asset Managers (UK)

NORTH AMERICA: Rate cuts do little to ease crunch

The US economy remains fragile as housing sector weakness feeds through to consumer sentiment and spending. It now seems likely that economic growth will slow, inevitably impacting profits growth.

Dr. Jerome Booth, Ashmore Investment Management

SOUTH AMERICA: Growth brings inflation concerns

In the US the focus is on the subprime debt and credit crunch woes and the course of interest rates and possible stagflation. The outlook is more benign however for Latin American economies and markets, as for emerging markets generally.

James Weir, Atlantis Asian Special Situations Fund

ASIA PACIFIC: Asian economies in good shape

In our view, Asia is exceptionally well positioned to outperform despite a G7 economic slowdown. The post-1997 financial rebuilding of the region is now beginning to bear fruit. In contrast to the G7 economies, balance sheets are in good shape at the sovereign, company and household levels, allowing reinvestment to drive future growth.

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