Strategy

Strategy: CIMB has Strategy report for 2011, with end-CY11 FSSTI target of 3,560, and implying a 1.9x CY11 P/BV (slightly above mean). Note that such valuations are not aggressive and reflect markets that are still conscious of the risks in a world of bipolar growth. Expect a pensive market at the turn of the year to explode suddenly before end-1H11, once perceptions of risk fade…

Among social trends, expect a widening income divide to add on to existing west-to-east migration. Among corporate trends, expect M&A and share buybacks to accelerate by mid-year….

For stock picks, tip that key themes of Asia consumption and commodities are well-known and still valid trends. Remain Overweight on Plantations/Commodities, Offshore & Marine and Financials. Underweight Property and Telcos. Top picks are Cache Logistics, DBS, Golden Agri, Genting Singapore, Keppel Corp, Keppel Land, OUE, SIA, Venture and Yangzijiang.