— This is the script of CNBC's news report for China's CCTV on January 27, Thursday.
Hello and welcome to the CNBC Business Daily. I', Li Sixuan at the Singapore Exchange.
Asian markets started the trading week in the red. The MSCI Asia Pacific Index plumbed near a 4-and-a-half month low as a confluence of factors weighed on sentiment. Emerging Asia assets came under pressure and selling in currencies such as the Indonesian Rupiah, Thai Baht, Filipino peso and Malaysian ringgit intensified.
Also adding to the gloom, tightening credit conditions in China raised fears of a sharper economic slowdown. But the experts we spoke to earlier see long-term potential in these markets. Have a listen.
(SOUNDBITE - Gary Dugan, CIO, Asia & Middle East, Coutts) You look at the GDP numbers this year, you still see a significant growth premium for emerging markets, the level of indebtedness for emerging markets are significantly below those of developed markets, so if I am looking for something to buy, I do believe the emerging markets, the selloff, is a buying opportunity, not something that you run from.
(SOUNDBITE - Jonathan Cavenagh, Senior FX Strategist, Westpac Institutional Bank) I think in the near term, the risks are that we see the USD strengthen pretty much uniformly across the board against most of the EM currencies. Of course, the problem for emerging markets here in Asia is that one often distinguishes Asia from other EM currencies as we'd seen in stronger resilient background coming out of China. That is no longer necessarily the case so now all of the EM is now painted with the same brush.
(SOUNDBITE - Todd Elmer, Currency Strategist, Citi) When we look at a lot of what's happening in EM, these are isolated political instances in places like Argentina and Thailand. They're not necessarily systemic issues. Many of these countries are better positioned to ultimately deal with flare-ups or shocks than has been the case in the past. So I would still say that over time, this isn't going to upset a constructive environment for investors.
The market selloff unlikely to sway the Federal Reserve from its tightening bias when it concludes its 2-day policy review on Wednesday. Bernanke and company expected to taper their bond buying plan by another 10 billion dollars, and reaffirm their commitment to ultra-low interest rates. Whether emerging market assets will take that in stride remains to be seen.
And that was your CNBC Business Daily, thanks for watching.