Political headwinds positive for PACAT

Political developments in the Asian region should be positive for key stocks in the portfolio of Pacific Assets Trust, says F&C's Peter Dalgliesh, manager of the portfolio.

"There are a number of upcoming political developments, across the region, which we believe should be positive," he said.

"For example, South Korea's opposition Grand National Party is well placed in the forthcoming elections. We therefore anticipate that a more pro-business stance will be adopted by the new government, something that would prove positive for construction firms like GS Engineering & Construction, one of the Trust's largest current holdings."

"And whilst Chinese democracy remains elusive the twice a decade Communist Party Congress should result in a political backdrop which raises the profile of Shanghai relative to other Chinese cities. Shanghai Industrial could benefit from such a shift as the new management team seeks to maximise the potential of its existing assets – a focus which should boost the share price" .

Finally, Dalgliesh believes Taiwanese elections will result in a more supportive business backdrop.

"Taiwan's property sector looks interesting with the potential for asset value appreciation along the lines of that enjoyed on the mainland. Taiwanese insurer Shin Kong Financial should benefit thanks to its significant property portfolio," he concluded.