Asian markets face turbulence in 2008: ratings agency

Asian markets face turbulence in 2008: ratings agency
Asian stock markets face a difficult 2008 and could slide sharply, ratings agency Standard and Poor's said Thursday as regional share prices fell heavily in early trading.

"2008 will be a more difficult year for stock market returns and we would not rule out the risk of a sharp correction," Lorraine Tan said in a statement accompanying a report by the agency's equity research unit.

Asian equity markets had reached increasingly risky levels and there would be less scope for them to rise after 2007's strong performance, the report added.

"Markets would be jittery over potential negative news, such as on inflation and further deterioration in the US and European economies," Tan said.

The comments came as major Asian markets dropped by between two and three percent early Thursday after an overnight slide on Wall Street caused by jitters about the outlook for the US economy.

The US is struggling with a credit crunch and housing market slowdown after record defaults on subprime mortgages extended to homebuyers with riskier credit profiles.

The report said markets in Hong Kong, South Korea and Thailand were likely to deliver better relative performance in 2008, but that Japan was set to do less well.

Standard & Poor's also expects more ratings downgrades for the corporate sector next year due to rising costs and less readily available credit.

Ian Thompson, the firm's chief credit officer for regional ratings services, said that "casualties" were expected, especially outside the financial sector.

He added that "the balance of our rating outlooks on the corporate sector suggests there may be more rating downgrades than upgrades among Asia-Pacific companies in 2008".

That contrasted sharply with the general improvement in credit quality this year, he said in the statement.

Standard & Poor's expects Southeast Asia to grow on average 6.4 percent in 2008, with Indonesia and the Philippines seen as bright spots.

My view - Guess this is not a good thing for punters and to me personally. But at the end of the day.....good thing will end one day, for this case too soon hahaha.
So, gotto rethink my options to deal with this.