Pacific (ex-Japan)

11/03/2010

Asian equities finished a volatile month little changed in February, as investors remained cautious about the impact of sovereign risk in the eurozone as well as the withdrawal of stimulus measures around the world. That said, the market was able to regain its balance after the initial shock of the Fed raising its discount rate, which led to worries about tightening in the policy rate. However, Fed Chairman Ben Bernanke was quick to reassure investors that interest rates would not be increasing. The Chinese authorities also hiked banks’ reserve requirement ratio for a second time in as many months. However, better macro data helped buoy the Chinese market, although Taiwan and Korea suffered as technology stocks slumped on uncertainty over the sustainability of the global recovery. Healthcare and industrials were among the best performing sectors while technology and telecoms trailed during the month.