The sharp drop in equity valuations early last week has prompted fund managers to buy back into stocks they see as undervalued.
Alex Lyle, fund manager at Threadneedle and deputy to Sarah Arkle, chief investment officer at the group, says he sees value in certain stocks. He has already started to reduce his underweight position in financials.
“We are defensively placed and focused on reliable companies with strong balance sheets,” says Lyle. “But we certainly see some interesting value appearing in financial sectors.”
Jeremy Tigue, head of global equities, also expects opportunities to arise, but he is waiting for a clearer view of markets once the Federal Reserve meets this week. “There is no conclusive evidence that there is going to be a recession,” he says. “There is a lot of panic around. A lot of investors are giving up and that’s what we’re looking out for.”