Another Take on Rise of the East

Asia offers a long-term equity opportunity because its economic growth and earnings potential remain underappreciated relative to the United States and other developed markets.

• Since 1980, Asia has grown faster than other regions, while emerging Asian economies had average output per capita nearly ten times higher in 2025 than in 1980.
• Asia is the world's second-largest equity market after the U.S., with nearly $50 trillion of market capitalisation, and accounts for six of the ten largest equity markets globally.
• Technology represents about half of local equity indices and earnings in Asia; AI-driven computing demand is expected to support roughly 20% annual IT-earnings growth over the next five years.
• Regional earnings are forecast to rise 75% in 2026, followed by 25% growth in 2027 and 14% in 2028, while overall earnings are expected to grow at a 10% CAGR over the next ten years.
• Population-weighted data still show economic convergence, with China’s GDP per capita rising from below 3% of the U.S. level in 1980 to about 35% today; India, Indonesia and Bangladesh have also made significant progress since the late 1990s.

Takeaway: Investors should look beyond U.S. technology stocks and consider Asia as a long-term buy, while recognising that larger emerging markets such as China and India may grow faster than smaller ones and that convergence is not uniform across countries.