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Aberdeen New Dawn Investment Trust PLC

 

Objective

The objective of Aberdeen New Dawn Investment Trust PLC is to provide shareholders with a high level of capital growth through equity investment in the Asia Pacific countries excluding Japan. In addition, it is the Investment policy of the company to invest in no more than 15 per cent of its gross assets in other listed investment companies (including listed investment trusts).



Manager's Monthly Report

January 2010


Markets & Economic Overview

Asian markets rose in December as economic data continued to improve across most of the region. Among the best performing markets were Taiwan and Korea, with their exports posting the first increase in more than a year. China’s recovery continued to gather pace in November on the back of brisk bank lending, while India posted a strong rebound in industrial activity, despite shrinking farm output caused by the poor monsoon. Inflation accelerated in China, India, Sri Lanka and Thailand. Most central banks kept interest rates at record lows, but Australia raised rates for a third consecutive month. In policy news, Beijing stepped up measures to curb real estate speculation and reduce overcapacity in several industries. In India, policymakers plan to help finance infrastructure spending from the sale of shares in three state-owned power companies.

Portfolio news

There were no major changes to the portfolio in December. In corporate news, our bank holding Standard Chartered expects any Dubai losses to be immaterial, while its counterparts in Singapore, Oversea-Chinese Banking Corporation and United Overseas Bank, do not have significant exposure to Dubai World. Korea’s Samsung Electronics reshuffled its top management in an ongoing reorganisation to streamline operations.

Outlook

Looking ahead, Asian markets may continue to rise, although it will be harder to make headway, given the strong performances posted in 2009. Recent corporate earnings growth has been driven by one-off factors, such as cost-cutting and inventory restocking, and a more fundamental improvement in profitability will be required if the rally is to be sustained. On the other hand, rising fiscal indebtedness will pressure governments of developed economies in the West to withdraw stimulus support, increasing the risk of policy mistakes. With the inherent imbalances in the global economy still not addressed, the likelihood of a global correction appears to have been carried over from last year. In such an environment, we see our stockpicking approach as especially relevant. Our well-managed holdings are financially sound, and should emerge stronger, whatever the current headwinds.




Source: Monthly Factsheet Aberdeen Asset Managers Limited