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By Goh Eng Yeow
AS TRADERS farewelled a dismal first half for regional equities on Monday, they were torn between fearing that Asian stock markets will slump further in the second half - and hoping that the worst is over.
Between January and June alone, the benchmark Straits Times Index plunged 15 per cent, as the local bourse registered its worst first-half since 2000 when global equities markets were reeling from the bursting of the dotcom bubble.
Elsewhere in Asia, the market numbers were equally grim.
China's Shanghai Composite Index lost nearly half its value while India's Bombay Sensex Index plunged almost 40 per cent, as both markets suffered their worst-ever first-half.
The Hang Seng in Hong Kong fell almost 21 per cent - its worst showing since the Asian financial crisis 10 years ago, while Tokyo's Nikkei-225 Index was down 12 per cent - its worst first-half in 13 years.
If history is any guide, the markets are now at a cross-roads and will make either a swift V-shaped recovery, as they did in 1998, or stay mired in several more quarters of misery, as they did after 2001.
To recap: In 1998, STI had lost a staggering 33 per cent in the first half, only to recover by an even more spectacular 38 per cent for the rest of the year, as a credit crunch then gripping Asian economies subsided.
But the worry among traders is that the gloom now enveloping global equities markets is more akin to the dreaded bear's hug of 2001.
Read the full story in Tuesday's edition of The Straits Times
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