Aberdeen Asset Management Plc is betting that investors are too pessimistic about industrial companies, shifting money into those stocks and selling health-care shares, the worlds biggest gainers this year.

Uncertainty about the global economy has spurred cyclical equities to lag pharmaceutical shares and other defensive industries by a margin thats too wide to ignore, according to Martin Connaghan, senior investment manager for global equities. Some industrial companies, such as elevator and escalator makers, have stable income from maintenance contracts that make them less sensitive to global growth, Connaghan said in an interview in Hong Kong on Aug. 28. Aberdeen Asset managed about $551 billion as of June 30.

A measure of worldwide industrial shares is trading near the lowest valuation relative to health-care stocks in more than a decade, data compiled by Bloomberg show. Health-care shares have rallied the most among the MSCI World Indexs 10 industry groups this year, buoyed by dealmaking and demand for equities with a profit outlook thats less tied to the global economy.

Theyve done particularly well these last couple of years, said Connaghan. On the other side of that, some of the more cyclical companies, whether it be some of the industrial type of companies or materials and mining, have been relatively weak so there has been a slight reduction of some of that defensive exposure and increase into some of the more cyclical stocks.

The MSCI World Industrials Index, which includes companies from Airbus Group NV to elevator maker Zardoya Otis SA, traded at 18 times its trailing 12 month earnings yesterday, compared with 22 times for the global health-care gauge. The disparity widened last week to the most since October 2002.

Investors have poured $4.3 billion into U.S. exchange-traded funds tracking health-care shares this year, more than eight times the $530 million they added to industrial ETFs, data compiled by Bloomberg show.

Global economic data the past few months have been mixed, with gauges of euro-region manufacturing and services industries unexpectedly falling in August, while Japans economy shrank the most in five years last quarter after a sales-tax increase. In the U.S., gains in factory activity last month contrasted with slower payrolls growth, while Chinese imports unexpectedly slid.

Were not necessarily saying the environment in the future will improve, said Connaghan. The outlook for cyclical stocks is tricky at this moment. We dont expect the outlook for these companies to necessarily change in the immediate future, we just think that there are a lot of bad news or low expectations.

Aberdeen is investing in industrial shares with stable revenue from services such as maintenance contracts, Connaghan said, while declining to name specific companies.

Some of the industrial companies arent as cyclical as they may appear when you first look at them, if you actually look at their revenues, Connaghan said. Demand for their actual product may decline but there is always a base level of income and revenues that are coming from areas that are more stable, regardless of the economic environment.

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Aberdeen Asset Sells Health-Care to Buy Industrial Stocks