JPMorgan for Asian Equities: We're seeing a temporary bullish rebound

What we are witnessing today in Asia and emerging markets may be just a temporary bullish rebound in a still bear market.

At least, they set out their vision of the region by JPMorgan Asset Management after we also saw a rally in the stock in Asia in January. While Jasslyn Yeo, a market strategist at JPMorgan, sees potential for additional profits in the first half of the year, investors are yet to reassess their positions for the second half of 2019.

The slowdown in economic growth around the world has overshadowed the prospects for the region's shares, although talks between the US and China have helped to sentiment. Moreover, the signal that the Fed sent to the markets for its "pause" was accepted as dovish and also helped to return to risky assets, but the chances of raising interest rates still remain higher than the discount rate.

The MSCI Asia Pacific Index reported a rally of 6.8% in January, recording its best start for the year since 2012.

Yeo remains bullish towards the Asian markets, with the exception of Japan and the emerging markets as a whole for the first half of the year. "There is a high chance for a deal between the US and China, especially nearing the US presidential election in 2020. Trump will necessarily want a deal with China."

Source: Bloomberg Finance L.P.

Graphs: Used with permission of Bloomberg Finance L.P.

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