Equity View Remains Unchanged Despite Potential Bear Rally

July 2008 | Market Strategy

Despite rallying strongly today on the back of better-than-anticipated Q208 results from Citigroup , we retain our view that Asian equities will remain under pressure over the medium term as inflationary concerns persist and central bankers are forced to tighten monetary conditions further. Moreover, we continue to retain serious reservations over the health of financials. Consequently, while there is some scope for further short-term gains for the region's equities, we would expect this to merely represent a bear rally and not the beginning of any significant turnaround in the fortunes of Asian stocks.

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