GLOVE companies may have seen much of their earnings already bottom out, with reward-to-risk payoffs appearing to be more balanced now.
In upgrading the sector to “market weight”, UOB Kay Hian Research says the sector is expected to bottom over the immediate-term.
“While sentiment could decline in tandem with the sector bottoming out, we think downside risks to earnings have largely been factored in.
“Thus, the reward-to-risk payoff appears balanced at this juncture, prompting us to upgrade the sector,” it tells clients in a report on the sector.
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