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Over the past year, the performance of major Asian markets has been mixed. Investors are shunning Chinese stocks and flooding into Indian and Japanese markets. Overall, the MSCI Asia-Pacific index rose by 11.8% in 2023, while the MSCI China index fell by about 11%. Meanwhile, Japan’s Nikkei Stock Average rose a massive 28%, outperforming the S&P 500, while India’s Nifty 50 and BSE Sensex rose about 20% in 2023. If you’re interested in stock picking rather than passive investing, consider checking out Morgan Stanley’s list. Some of the Asian stocks the firm calls “alpha” opportunities for February. Alpha stocks are stocks that have the ability to beat the market. One of the top ideas highlighted by the bank is Taiwanese semiconductor company MediaTek, in which the bank is overweight. Morgan Stanley believes MediaTek is a “key enabler” of edge artificial intelligence. Edge artificial intelligence is a term defined by banks to refer to running AI algorithms directly on users’ devices, such as smartphones, laptops, and wearables. The bank expects the company’s revenue to grow significantly in 2025 thanks to its AI products, and believes the company’s price-to-earnings ratio of 13 times is attractive. India’s Tata Consultancy, which was upgraded to overweight by Morgan Stanley in January, was listed as another top idea. Morgan Stanley believes that “revenues are resilient and strong.” [earnings before interest and taxes] “With strong margins and positive management commentary, valuation premiums are likely to be sustained if execution improves.” These are from Morgan Stanley’s complete list of top overweight stocks for February. Some brands. Each has a market capitalization of over $5 billion. —CNBC’s Michael Bloom contributed to this report.
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