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Sun 17 Apr 2011 08:10 PM

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Templeton's Mobius upbeat on Mideast markets

Veteran emerging markets investor Mark Mobius expects unrest to benefit region in the long-term

Templeton's Mobius upbeat on Mideast markets

Veteran emerging markets

investor Mark Mobius is bullish on Middle East markets and

expects recent political events to benefit the region in the

long-term, he said on Sunday.

"My outlook is very positive because I see these political

changes result in more open societies, more dialogue and

therefore better environment for markets including stocks and

bonds," Mobius told reporters in Dubai.

"I am not saying the ride is going to be smooth and in many

places we could see some bumps but the overall trend is

positive."

Social unrest in the Middle East over the last few months

has swept the leaders of Egypt and Tunisia from power, sparked a

violent revolt in Libya and led to protests demanding reform

from Syria and Jordan to Yemen and Bahrain.

Mobius, who oversees the management of around $45 billion in

assets, is executive chairman of the Templeton Emerging Markets

Trust, part of US asset manager Franklin Resources.

The executive also added that a potential upgrade of Qatar

and UAE to emerging market status may not alone have have a huge

impact on these markets as their weight in the index will be

relatively low.

The influential index compiler has kept the two markets for

a review in June.

"It's not material for us. We see them as frontier markets

and will continue to do so," he said.

Franklin Templeton's $1.2 billion frontier fund counts

Orascom Telecom and Saudi Basic Industries Corp

among the top holdings and has heaviest allocation to

Nigeria and Saudi Arabia on a geographic basis.

Last month, Mobius told Reuters that a recent pull back in

emerging market stocks has uncovered value in frontier markets

and smaller emerging market stocks.

Mobius enjoys strong success in Asia, where his $15.5

billion Templeton Asian Growth Fund has given investors an

over-five-fold return in the past decade.

While the fund was off 4.8 percent in US dollar terms in

the first two months of this year, it had risen nearly 28

percent over 52 weeks and 14.4 percent on an annualised basis

over five years.

In January, the emerging market guru said he was considering

a plan to set up a hedge fund, a move that would mark a major

shift from the traditional money manager into the $1.9 trillion

alternative asset management industry.

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