Gartmore Japan AR moves defensive

Gartmore's John Stewart has turned to defensive stocks and opened up short positions in cyclical sectors within the Japan Absolute Return fund following the market's poor performance.

Stewart says Europe's sovereign debt crisis hit Japan hard, with the Topix index falling 10.8% in May. Although every Topix sector fell over the month, those exposed to credit markets suffered particularly heavy losses, with real estate plummeting by 18.1% and non-bank financials by 17.9%. Exporting sectors also suffered after the yen's appreciation, particularly those companies with significant exposure to Europe or with strong European competitors, Stewart says. "As a result of the turbulent macro backdrop, the portfolio has been taken more defensive and, unlike earlier in the year,...