May 6 (Reuters) - Asian equities valuations jumped to the
highest since January at the end of April, following a sharp
recovery in regional shares last month due to the stimulus
measures unveiled by governments to mitigate the damage caused
by the coronavirus pandemic.
MSCI's broadest index of Asia-Pacific shares .MIAP00000PUS
gained 8.13% in April, recording its best month in more than
four years. The surge drove the index's 12-month forward
price-to-earnings (P/E) ratio to 13.46 at end-April, compared
with 11.79 a month earlier.
Asian equities reflect excessive optimism about corporate
performance, ANZ Bank said in a report, warning that the
first-quarter corporate results might reflect the full scale of
the growth shock that would lead to renewed downward pressure on
regional equities.
So far, Asia's large- and mid-cap firms have posted a 17%
fall in first-quarter net profits, data from Refinitiv Eikon
showed.
China, Vietnam and South Korea shares were the cheapest in
the region, with P/E ratios of 9.6, 10.4 and 10.6, respectively.
New Zealand was the most expensive with a P/E ratio of 28.3,
followed by Thailand and India.
Despite the sharp recovery last month, Asian shares lagged
their global peers in terms of valuations. MSCI's World Index
.MIWD00000PUS gained about 10.6% last month and its P/E ratio
jumped to a 16-year high of 16.62.
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MSCI Asia and World Index's PE IMAGE https://tmsnrt.rs/2YADUu3
Valuations of Asia-Pacific equities IMAGE https://tmsnrt.rs/2z6h4j7
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