Australia’s immense wealth
Australia has a history of strong population growth – in the last 50 years it grew by 1.4% a year on average. Since 1972, its population has doubled, to 26.5m in Q1 2023, with population growth split roughly evenly between migration and natural increase.

Australia’s retirement savings system, featuring mandatory contributions into the superannuation system, combined with strong population growth, is supporting asset prices, as well as providing a rapidly growing pool of retirement savings, which is already the fourth largest in the world. The 2023 Intergenerational Report (IGR)1 projects that superannuation balances will jump further, to a ~218% share of GDP by 2062/63 – from $3tn now, up to as much as $33tn in 2062/63. Household wealth averaged at roughly $2m for those aged 55+ (for CY 22/23); superannuation benefits (excluding Self-Managed Superannuation Funds (SMSFs)) in 2022/2023 surged 20% year-on-year to $102bn, equivalent to a >8% share of household income.

There are long-term structural reasons to expect foreigners to continue to favour Australia as a preferred destination option. These include the relative resilience of the Australian economy, which avoided a recession for a world record of three decades (until the Covid-19 pandemic), which has resulted in living standards increasing to among the highest levels globally. There is also a recognised trust in the Australian government and institutional arrangements that impact the “quality” of life.

Australia’s population is ageing, but the rate has materially slowed (i.e. improved) given the ongoing fast pace of migration. Overall, the median age of the Australian population is 37.9 years, which is already a significant 3-years younger than the OECD average. By 2050, Australia’s median age is expected to increase to 41.8, but populations in many other countries will age more rapidly. Hence, by 2050, Australia is expected to become an even more significant 5-years younger than the OECD average.

Australia’s share of migrants with a tertiary education is 62%, which is among the highest in the world. It’s also much higher than Australia’s native-born population, with a 43% share. The Australian government Final Budget Outcome (FBO) for 22/23 was a surplus of 0.9% of GDP (or $22bn), far better than comparable economies.

Source: UBS
India – Modi set to win general election
Modi-led Bharatiya Janata Party’s (BJP) win in the three state elections of Madhya Pradesh, Rajasthan and Chhattisgarh, was much better than predicted or expected by exit polls and markets, reinforcing expectations of a Modi win in 2024 national elections, with a greater likelihood of 300+ seats for the BJP. Results for the four state elections show BJP gains in seats and vote share in each state. In 2018, BJP lost elections to Congress in the states of MP, Rajasthan and Chhattisgarh; all three have been won back with clear majorities.

ITC has become India’s largest fast-moving consumer goods (FMCG) manufacturer in the foods space by domestic sales (in the nine months to September, source: NielsenIQ). ITC has emerged as the largest packaged foods company (25+ mother brands, total/direct reach 7/2.6m), benefitting from formalisation tailwinds and high innovation intensity. It occupies top three positions in most categories with share gains (Aashirvaad flour, Sunrise, premium biscuits). Three in four households consume ITC’s food brands, and three quarters of Indian retail carries ITC’s food brands. ITC’s FMCG reach is at 7m outlets, and the business has launched 300 new products in the last three years.
Backdrop remains tough for China
China’s official Manufacturing Purchasing Managers’ Index (PMI) declined to 49, weaker than the median forecast of 49.6 by economists (source: National Bureau of Statistics), marking the third consecutive month below 50. Employment remained in contraction for the ninth time in the past ten months. Meanwhile, China’s real interest rates (a gauge for actual borrowing cost) hit 3% in November, the highest level in almost three years, as deflationary pressure builds. The slide in China’s home sales accelerated in December, underscoring the challenges of the sector. Across the 100 biggest real estate companies, the value of new home sales fell 34.6% year-on-year, to 451.3bn yuan ($64bn), compared with a 29.6% decline in November.

More Chinese agencies and government-backed firms across the country have ordered staff to stop bringing iPhones and other foreign devices to work, including those made by Samsung. The move was broader than previous reported measures in September, when only a small number of state agencies in Beijing and Tianjin were telling staff to leave foreign devices at home.

The Biden administration is reportedly discussing raising tariffs on some Chinese goods, marking a shift from earlier discussions that focused on whether to lower them (source: Wall Street Journal). The targeted goods include Chinese electric vehicles, solar products and EV battery packs for protecting the US clean-energy industry.

We continue to have no exposure to mainland China. We believe China has many deep-rooted problems, including its political system, debt and demographic headwinds, and it is increasingly viewed with suspicion by trading partners, direct investors and portfolio investors.
2024 outlook
This year, we expect to see a two-way pull for markets. The prospect of looser monetary policy globally may allow for P/E expansion and higher prices; meanwhile, many businesses could struggle to prevent their earnings declining if we see weaker economic growth and rising unemployment in key markets, such as the US. Though inflationary pressures have eased, the next leg of this cycle may be one of weaker growth, as the lagged effects of the higher interest rates we’ve seen kick in. Nevertheless, we still expect to see growth in earnings and dividends coming from a good number of the companies that we hold. These include the technology businesses we invest in, which experienced a difficult 2023 but where we think we will likely see an earnings rebound in 2024. Infrastructure, property and telecom stocks ought to feel some relief from a cessation in the rise of interest rates, particularly if combined with a further decline in bond yields.

2024 will be notable for the large number of general elections happening all around the world. In Asia, these include elections in Taiwan, India, Indonesia, and elsewhere. Outside of the Asia Pacific region, key international elections will include those of the US and, most likely, the UK. If incumbents are ousted, we will be mindful of the potential resulting policy changes.

Read our full 2024 outlook here: Outlook 2024: Asia Pacific – A two-way pull for stock markets? – Jupiter Asset Management (

The Jupiter Asia Pacific Income Fund (IRL)

Performance chart
Past performance is no indication of current or future performance and does not take into account commissions and costs incurred on the issue/redemption of shares. Returns may increase or decrease as a result of currency fluctuations.
Source: Morningstar, NAV to NAV, gross income reinvested, net of fees, in USD, to 31.12.2023. Fund inception: 13.09.2000. Since FM inception: 22.03.2023. Peer group: EEA Fund Asia-Pacific ex-Japan Equity. Benchmark: MSCI AC Asia Pacific ex Japan NR USD. In March 2023, the Fund changed its Investment Objective. The performance before this date was achieved under circumstances that no longer apply.
Country weightings: Australia 29.8%, India 18.1%, Taiwan 17.6%, Singapore 11.5%, South Korea 9.5%, Hong Kong 7.0%, Indonesia 5.2%, Thailand 0.8%.

Top 10 holdings: Mediatek 6.5%, ITC 6.3%, TSMC 6.0%, Samsung Electronics 5.5%, Hon Hai 5.2%, BHP 5.2%, Woodside Energy 4.2%, Power Grid 3.8%, Singapore Telecom 3.7%, DBS 3.6%.

Source: Jupiter, FactSet, as of 31.12.2023

Holding examples are for illustrative purposes only and are not a recommendation to buy or sell.
Fund-related risks
  • Investment risk – there is no guarantee that the Fund will achieve its objective. A capital loss of some or all of the amount invested may occur.
  • Geographic concentration risk – a fall in the Asia Pacific markets may have a significant impact on the value of the Fund because it primarily invests in these markets.
  • Company shares (i.e. equities) risk – the value of Company shares and similar investments may go down as well as up in response to the performance of individual companies and can be affected by daily stock market movements and general market conditions.
  • REITs risk – REITs are investment vehicles that invest in real estate, which are subject to risks associated with direct property ownership.
  • Stock Connect risk – Stock Connect is governed by regulations which are subject to change. Trading limitations and restrictions on foreign ownership may constrain the Fund’s ability to pursue its investment strategy.
  • Currency risk – the Fund is denominated in USD but holds assets denominated in other currencies. The value of your shares may rise and fall as a result of exchange rate movements.
  • Emerging markets risk – less developed countries may face more political, economic or structural challenges than developed countries.
  • Liquidity risk – some investments may become hard to value or sell at a desired time and price. In extreme circumstances this may affect the Fund’s ability to meet redemption requests upon demand.
  • Derivative risk – the Fund may use derivatives (i.e. financial contracts whose value is linked to the expected price movements of an underlying investment) with the aim of reducing the overall costs and/or risks of the Fund.
  • Capital erosion risk – all or part of the share class charges may be taken from capital. Should there not be sufficient capital growth in the Fund this may cause capital erosion.

  • For a more detailed explanation of risks, please refer to the «Risk Factors» section of the prospectus.

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