Fund managers change tack as Fed reacts to virus

Fund managers are changing their allocations after the U.S. Federal Reserve stunned investors with a half-point rate cut this week to contain the economic fallout from the coronavirus epidemic.

Some analysts say the Fed's move will unleash a global wave of monetary easing, which will have a big impact of financial markets. The following is a summary of how fund managers are changing their portfolios and the advice they are giving to their clients:

WILL MALCOLM, PORTFOLIO MANAGER, APAC EQUITY STRATEGIES, AVIVA INVESTORS, SINGAPORE *Market selloff entering phase where better to look for opportunities to buy

*Taking view that market turmoil is temporary, only a one-time event for price-earnings ratios *Aviva Investors manages 356 billion pounds ($458.85 billion) globally as of September 2019

TOSHINOBU CHIBA, CHIEF FIXED INCOME PORTFOLIO MANAGER AT NISSAY ASSET MANAGEMENT, TOKYO *Buying more U.S. Treasuries with durations from three to seven years and hedging the currency risk in the forwards market

*Increasing investment in Chinese government bonds as well as extending durations *Buying into newly issued U.S. credit funds

*Expects one more market sell-off due to coronavirus *Nissay Asset Management had 13.01 trillion yen ($121.21 billion) in assets under management at the end of March 2019.

VINCENT MANUEL, CHIEF INVESTMENT OFFICER, INDOSUEZ WEALTH MANAGEMENT, PARIS *Downward revisions to corporate earnings are already priced in due to recent equity sell off

*Market correction is an opportunity to build equity positions *High-yield bond market vulnerable, spreads to widen further

*Calling for a shift to equities from fixed income MICHAEL KELLY, GLOBAL HEAD OF MULTI-ASSET, PINEBRIDGE INVESTMENTS, NEW YORK

*Buying back China A shares *Reducing stocks exposed to U.S. services sector

*Commodities have been terrible due to worries about China demand but could improve in future *Pendulum shifting to manufacturing

*PineBridge had $101 billion under management at the end of 2019 ($1 = 107.3300 yen) ($1 = 0.7759 pounds)