The renewed spike in Covid-19 cases across Asia isn’t a major concern and the region’s economy will get back on track once the outbreak wears off, said an investment strategist with Citi Private Bank.
With that in mind, investors could go for “covid-affected” stocks like airlines and other companies in the travel and leisure sectors, said Ken Peng, head of the bank’s Asian investment strategy.
Peng told CNBC’s Capital Connection Tuesday that Asia is not seeing a resurgence in Covid for the first time.
“This is a movie we’ve seen before,” he said.
A security guard walks past a mural in Mumbai on January 13, 2021 depicting people from different religions thanking the Covon-19 coronavirus warriors on the front lines.
Indranil Mukherjee | AFP | Getty Images
“It happened in the winter that just passed, and it happened in the last third quarter when we had these waves, and when the falls are over you’ll see the economic recovery back on track. I think you have to we don’t worry too much about it, “he added.
Asian economies from Nepal to Malaysia and Taiwan have seen a daily record increase in Covid infections in recent weeks, according to Johns Hopkins University.
In India, which has the world’s second worst outbreak, daily cases continue to rise despite falling from record levels in early May, data showed.
China Tech, raw materials
In addition to sectors that have been hard hit by the pandemic, Peng sees opportunities to buy Chinese technology stocks. He added that the share prices of some of these stocks have fallen as a result of government scrutiny.
The strategist also said he was “very positive” on commodities, with demand from China, the US and Europe likely to remain robust.
“In those countries that are closer to herd immunity, raw material demand is likely to continue to grow. I think as the global recovery continues, we shouldn’t be too concerned about raw materials right now,” Peng said.
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