Fidelity Says 'All Things in Place' for Bull Market

By Hanny Wan and Bernard Lo
April 30 (Bloomberg) -- Anthony Bolton, president of
investments at Fidelity International, said a bull market in
equities has already begun and financial shares are poised to
drive recent gains higher.
Low valuations indicate advances that began in March are
the start of a bull market, Bolton said. He favors financials,
consumer cyclical, technology, and "value stocks," such as
retailers, automakers and construction-related shares.
"All the things are in place for the bear market to have
ended," Bolton said in an interview with Bloomberg Television
in Hong Kong. "When there's a strong consensus, a very negative
one, and cash positions are very high, as they are at the moment,
I'd like to bet against that."
The MSCI World Index has dropped 3.2 percent this year,
extending last year's 42 percent slump, the worst annual
performance since at least 1970. Shares plunged as a collapse in
U.S. consumer spending and a freeze in credit markets sent the
U.S., Europe and Japan into their first simultaneous recessions
since World War II.
The declines dragged the gauge's price-to-book value, or
the ratio of stock prices to company assets, to 1.5, down from
2.4 at the beginning of 2008.
Bolton, who is based in London, said that in September he
started putting money into Fidelity's China-focused fund, which
invests in Hong Kong-listed H shares of Chinese mainland
companies, and into Japanese stocks.

Not Bear Rally

Investments in money market funds in the U.S. have reached
a record and could fuel a bull market during the next two to
three years, he said.
Bolton's view contradicts that of Nouriel Roubini, the New
York University professor who predicted the financial crisis.
Roubini said last week he was "still bearish" and that an
economic recovery is going to take "longer than expected."
"Nearly all the broker research I read says 'bear-market
rally,' that's one of the other things that makes me think it's
the beginning of a bull market, not a bear-market rally,"
Bolton said. "When everyone is extremely negative, I want to
bet against that. If you wait for things to get better, you'll
miss the rally."
Fidelity International managed about $157 billion as of
January, according to Hong Kong-based spokeswoman Megan Aitken.