Asia: Warnings on stocks correction grow louder

(Jan 31): It's time to take some money off the table.

That's according to strategists across Wall Street, who say a pullback in Asian equities is imminent. Morgan Stanley is eyeing a "meaningful" dip in the Hang Seng Index within weeks, while Goldman Sachs Group Inc. says the MSCI Asia ex. Japan Index could drop more than 10%. Both gauges are enjoying one of their longest bull runs on record, entering its 717th day.

While there's been no shortage of warning signs, with most technical and valuation metrics flashing sell, investors have been reluctant to cash out. The region's resilient economic growth, rebounding corporate profits and relatively low multiples have been enough to sustain the rally, and are likely to attract dip buyers when markets do fall, the strategists say.

---

Related Stories

• Asian equities to benefit from strong global macro tailwinds in 2024: HSBC
• Asian equities display high potential for strong returns in the year ahead: Schroders
• Democratic sweep in the US could boost Asian stocks

---