HSBC cut its weighting on Egypt to "neutral" from "overweight," on increased political risks, and upgraded Poland to "overweight" from "underweight," on macroeconomic stability and valuation.
HSBC downgraded South Africa to "underweight" on higher valuations. "We are funding the move into Poland out of South Africa, which we see as an expensive defensive, and Egypt, where political risk is intensifying again," HSBC analysts said in a note.
The brokerage said the Egypt downgrade was driven by delays in the electoral timetable and a corresponding increase in political risk.
Egypt's Finance Minister Hazem el-Beblawi quit today, less than three months in the post, over the government's handling of a protest by Coptic Christians on Sunday night.
The protest ended with clashes between the army and demonstrators that killed 25 people, making it the deadliest outbreak of violence since the ousting of Mubarak in February, and sparked anger among Copts and rights activists.
HSBC said Polish valuations now look low compared with where they have traded historically.
The brokerage said macro stability in the Polish market coupled with decelerating inflation levels and positive domestic economic cycles will drive Gross Domestic Product (GDP) growth of about 3 percent for 2012.