Asian Markets: Regaining Their Footing

Investors have watched Asian markets this week as they continued to tumble. An article from Forbes.com entitled: "Asia Stocks To Twist With U.S. Earnings" describes the 3 day selling spree in emerging markets: "Nikkei 225 average dropped 8% to 8,693.82, at one point nearing a five-year low touched the week before. Hong Kong's Hang Seng fell 10.8% to 14,554.21, while China's Shanghai Composite Index slumped 7% to 1,930.65."

This was all on fears of weak 3^rd quarter reports, continued US troubles, and general fears of slowing worldwide growth. However, stocks rallied sharply yesterday - almost across the whole of Asia. The Emerginvest Heat map shows it quite well graphically:

Hong Kong was up 5.28%, Japan up 3.70%, India 2.5%, South Korea 3.0%, and Thailand 1.2%. an article published on Marketwatch called: "Mumbai, Hong Kong set for rebound; Tokyo Jumps," describes how the dual forces of bargain hunters who are snatching up companies which are exceedingly undervalued, in combination with Korea announcing on Sunday that they will "back as much as $100 billion of banks' foreign-currency debt" sparked the jump in Asian markets today.

It marks an important point, both psychologically and economically as the week-long slide seems to have stopped. The article from Marketwatch cites Markus Rosgen from Citigroup as saying: "'Given current valuations and sentiment, we shall increasingly be looking for opportunities to invest. Until now, by contrast, we had been looking for opportunities to sell,' they added."

As massive losses continue to accrue, it seems like bargain hunters are becoming more and more willing to admit they might see a bottom in the moderate future. Looking at stocks like ICICI Bank (IBN) and China Mobile (CHL) which are down well over 50% for the year, helps to underscore the buying opportunities which are becoming increasingly attractive. I still think there are going to be additional downturns, especially if exports have a sharper drop than expected, but I will be keeping a close eye on the markets in the near future for good growth buys.

Stock position: None.