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Despite frequent warnings that the economic recovery remains fragile, Canadians are becoming more optimistic about investing, according to a national survey by Manulife Financial.

It is the third consecutive quarterly rise in the Manulife Investment Sentiment Index, with investor confidence rising for eight of 10 investment categories and vehicles.

“Canadians appear to be more optimistic about a range of investments this fall, after leaning toward safer havens earlier this year,” said Paul Rooney, president and CEO, Manulife Canada. “Stocks and investment funds generally seem to be regaining favour.”

Each category is scored based on the percentage of respondents saying it was a good time to invest in that category, minus the percentage that said it was not a good time to invest. Undecided respondents are not included.

Investing in their own homes was the most popular use of Canadians’ money, with a score of +57 – with 66% saying it was a good time to invest in their primary residence, and 9% saying it was not.

Investment real estate was second most popular, with a +40 score. Cash and near-cash instruments both scored a +18 positive sentiment.

Balanced funds gained six points from the second quarter reading, to reach +14, with 38% saying they were a good investment choice, and 24% saying it was a bad time to invest in them.

Stocks gained nine points, pulling the category out of negative territory to an overall reading of +1, with 34% saying it was a good time to get back into the market, compared to 33% who said it was not. Twenty-four percent were unsure.

When asked about how best to hold their investments, RESPs retained the top spot in terms of sentiment, with a +46 reading. The RRSP was close behind, with a +41 reading. The difference reflects a slightly higher percentage of respondents holding a negative opinion, with an identical 57% favouring the RESP and the RRSP.

Seg funds scored a +16, while mutual funds were up seven points to a reading of +7.

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RBC appoints new Asia execs

The London-based international division of RBC Wealth Management has announced the appointments of Matthew Yong and Frank Mu as president and CEO respectively of its Asia operations. At the same time, the firm has unified its operation on that continent to create RBC Wealth Management, Asia.

Yong will be responsible for sales and distribution activities in Asia. Mu will continue to lead the advisory team, while also focusing on client solution support and functional support.

“Matthew and Frank are exceptional leaders and we have a strong team in place to serve the integrated wealth management needs of high net worth and ultra high net worth families in Asia,” says Doug Gunton, head of Asia and Canadian international centres, RBC Wealth Management. “Asia is a high growth region and a key priority for RBC Wealth Management’s international wealth management business.”

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Emerging markets set to lead

As developed economies wallow in the mess created in their own financial centres, emerging markets will lead the global economic recovery, according to global banking giant HSBC.

“As the world’s economic centre of gravity shifts from West to East, the economic strength of emerging markets will play an increasingly central role in the development of financial markets and international relations,” said Stephen Green, group chairman of HSBC Holdings plc. “The HSBC Emerging Markets Index provides a unique snapshot of the economic heartbeat of emerging markets.”

The HSBC Emerging Markets Index (EMI) climbed 9%, from a reading of 50.7 in the second quarter, to 55.3 in the third. That marks the strongest growth in manufacturing and service output since Q2 of last year. The index hit a low of 43.8 in the final quarter of 2008, with any reading below 50 indicating output contraction.

“Although the US remains the most important trading partner for many emerging nations, its relative importance is declining,” said HSBC chief economist Stephen King. “We now expect emerging nations to see economic growth of 6.0% next year while the developed world will expand by only 1.8%.”

(10/06/09)