UK - Henderson Global Investors is urging pension funds to snap up cheap equities before markets bounce.
Global markets went on a rollercoaster ride after US-based telecoms giant WorldCom admitted that it had inflated its profits. The firm – which is audited by Andersen – is set to restate its 2001 results and 2002 first quarter figures.
The FTSE100 dropped below the 4500 level as a result, falling 181.4 points to 4449.6 points before steadily recovering.
But Henderson’s global head of research and strategy, Rupert Carnegie, says markets are undervalued and offer an excellent buying opportunity comparable to September 2001.
Carnegie added: “We see the recent sell-off as a second opportunity to pick up cheap stocks in oversold markets. The markets have failed to discount forward as is usual in the first year of recovery – but that may delay the markets’ recovery, it does not automatically prevent it.”
Carnegie dismissed fears about the health of the global economy and insisted that it was recovering well. The firm is likely to revise its forecasts upwards and called the current woes “the final kick” from the unwinding of the 1998-2000 tech bubble.
Henderson believes that other factors have been at work – among them “Enronitis” – a lack of investor confidence due to accounting scandals.
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