The results show that 53%, a four-month high, expected to increase equity allocations to the Middle East in the next three months, while none expected a decrease, predominantly due to the strong performance of stock markets.
Respondents were also optimistic about the regional fixed income market, albeit with a hint of caution over the prospect of a decrease in US monetary stimulus. Some 20% expected to raise allocations to regional fixed income in the next three months while 13% expected a reduction.
There was a discrepancy in opinions on UAE equity markets, where 33% of managers expected a hike in allocations but 20% expected a cut in exposure. Money is being shifted from UAE to Qatar and 47% of managers said they would raise allocations while only 7% stated they would expect a decrease.
For Saudi Arabia, 60% expected to increase allocations, while there was a similar bullish tone to investing in Egypt, where the stock market has risen by more than 60% since July’s ousting of President Morsi. Some fund mangers were optimistic about upcoming elections which they hoped would stabilise the political situation and lead to an economic recovery, with 53% of fund managers expecting to raise allocations to Egypt and only 7% expecting a decrease. Many fund managers remain bearish on Turkey due to political turmoil and currency volatility, with only 7% expecting to raise allocations and 33% expecting to cut exposure.
The survey was conducted by Trading Middle East and the following institutions took part: Abu Dhabi Fund for Development; Ahli Bank Oman; Al Rayan Investment; Al Mal Capital; Arqaam Capital; Emirates NBD; Global Investment House; Mashreq Bank; Naeem Financial Investments; National Bank of Abu Dhabi; Rasmala Investment Bank; Mohammed Alsubeaei & Sons Investment Co (MASIC); Schroders Middle East; Securities and Investment Co of Bahrain; Amwal Qatar.