AMP Capital Investors, an Australian fund manager, has moved to "neutral" from an "underweight" position on global equities amid signs that Europe's sovereign debt crisis is easing, according to one of the company's top strategists.

The company, with close to US$100 billion in assets, is buying initially into Asian market weakness believing that most of the risk from Europe's crisis has been priced in, said Nader Naeimi, who heads up AMP Capital's Dynamic Asset Allocation unit in Sydney. The firm has started by stocking up on emerging market shares, which it says have the highest growth potential.

Asia's benchmark stock measure, the MSCI Asia Pacific Index, has dropped close to 20% since the start of the year - making the valuations of companies in the region attractive, according to AMP Capital, which was "underweight" equities since about May. Stocks worldwide have plunged this year amid investor concern that the debt crisis could trigger a repeat of the worldwide credit crunch and derail a fragile global economic recovery.

Strong support for a Spanish debt auction Tuesday helped boost investor confidence that measures put in place to address the banking and sovereign debt crisis may finally be gaining traction.

-By Shani Raja, Dow Jones Newswires; +61-2-8272-4683; shani.raja@dowjones.com

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