Lazard’s Donald bullish on China despite slowdown

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Lazard Asset Management fund manager James Donald is optimistic about China despite recent worries over the country’s slowing growth.

Donald, who manages the £407m Lazard Emerging Markets fund, is mindful of risks in the Chinese market but still believes the opportunities are worth going for.

Donald says: “There are still risks with Chinese shadow banking. We had a long a period of having very little in China but worries about Chinese growth forced down valuations.”

Concerns regarding Chinese growth have dogged the market recently, with the HSBC Flash China Manufacturing Purchasing Managers’ Index slumping to 47.7 points earlier this month – an 11-month low.

However, Donald is finding opportunities from these negative headlines: “We have made a lot of investments in China because people became negative about Chinese growth.

“Although we are not believers in commodity price reaction, it is not impossible because China will continue to spend on infrastructure.”

According to the fund’s most recent factsheet, top 10 holdings include China Construction Bank and China Mobile.

Lazard Emerging Markets’ cumulative performance to 30 July 2013

 
Fund -4.97% -5.18% 6.26% 7.77% 38.69%
-5.83% -6.07% 6.14% 5.26% 30.61%
0.91% 0.95% 0.11% 2.38% 6.19%
 of Main Unit  23 / 71 30 / 70 26 / 66 16 / 50 10 / 35
2 2 2 2 2

Source: FE Analytics