ABN Amro Holding NV reduced its rating on Taiwan's equities to "underweight" from "neutral" on concern the nation's economy will be weakened by companies relocating production and services to China.
"We are bearish on Taiwan from a long-term structural perspective," Eddie Wong (
Taiwanese manufacturers such as Hon Hai Precision Industry Co (
Investors should switch funds from Taiwan into Southeast Asian markets such as Thailand and Malaysia, which can better withstand slowing global economic growth because they rely more on domestic demand, Wong said. He raised his rating on the two markets to "overweight" from "neutral."
Taiwan's Taiex index has lost 2.7 percent since the end of June, while Malaysia's Kuala Lumpur Composite Index climbed 3.9 percent and the SET Index in Thailand added 1.6 percent.
ABN Amro maintains shares of Hon Hai, Chunghwa Telecom Co (