Salient to Investors:
Stocks in developed countries are being favored over emerging markets in the belief they provide a cushion during a weakening recovery.
Keith Wirtz of Fifth Third Asset Management sees a shift to countries less reliant on mining and energy production.
Eric Teal of First Citizens Bancshares said definitions of buy, sell and hold vary by country, so the direction of revisions is a better indicator of sentiment than the absolute level.
Bloomberg data shows the average rating for stocks in advanced economies rose this quarter to 3.68 from 3.64 versus a fall for emerging market stocks to 3.74 from 3.78 (5 strongest buy, 1 strongest sell). Average for advanced countries has stayed between 3.843 and 3.635 since 2010 for advanced countries and 3.731 to 3.868 for emerging, data show.
Developed nations’ stocks trade at 13.7 times earnings and emerging markets trade at 10.8 times.