Monday 26 January 2009

Fledgling markets in shock after the battering of 2008

If the central and eastern European markets had their day in the sun in 2007, when local stock markets were booming and inflows to funds were strong, 2008 was more like a total solar eclipse.

With stock markets in freefall and local currencies taking a pasting, money was cascading out of investment funds across the region.

“The markets saw outflows in all categories and the collapse of a number of bubbles, such as small cap and Russia,” says Nicolas Faller, head of distribution partners at Fortis Investments. “Even bond funds suffered due to higher rates on bank deposits and rising interest rates at the beginning of 2008.”

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