Goldman Sachs sees 14% returns for Asia ex-Japan stocks next year – BBG

According to Goldman Sachs Group Inc., one of the world’s top-performing regions, Asia, is expected to extend its bullish momentum into 2018 on the back of strong corporate earnings and favorable stock valuations, Bloomberg reports.

Key Points:

Stocks in Asia excluding Japan will outperform next year after staging a 33% rally in 2017 -- twice the gain achieved by the S&P 500 Index.

Goldman raised its 12-month target for the MSCI Asia Pacific ex-Japan Index by 9.7% to 620. 

Goldman Sachs favors China, India and South Korea stocks.

Both corporate profits and the total return on the index will surge 14 percent next year, with earnings growth especially strong in the technology, materials and insurance sector.

As for China, Goldman suggests staying bullish on financials and says environmental stocks will continue to be a popular theme. Its end-2018 targets for MSCI China, the Hang Seng and the CSI 300 imply an 8.7 percent, 7.3 percent and 11 percent upside respectively from Tuesday’s close.