Global stocks, emerging market currencies and high-grade credit all benefited in the last month from a steady improvement in investors' risk tolerance.
But dour corporate outlooks, poor retail sales and prospects for higher unemployment have curbed appetite for riskier assets. Experts tell CNBC where to invest during the turmoil.
US Stocks May Test the Downside Again
The U.S. market may test the downside again, probably some time after President-elect Obama takes office, according to Dodge Dorland, CIO at Landor Investment Management.
Cashing In on Gold
As Ahki Kamkolkar, head of futures at Halifax Investments believes it is possible that gold may spike above $1,000 in 2009, he reveals how he is playing gold and other commodities.
Adopt a "Depression-Led" Type of Strategy
Sean Darby, head of regional strategy at Nomura International suggests investors adopt a "depression-led" type of strategy when buying equities in the next 12-18 months. He tells CNBC why.
What Will Signal a Turnaround?
Another 10% to 15% rally does not signal the end of the bear market, warns Dodge Dorland, CIO at Landor Investment Management.
Airlines Face Headwinds
Avoid the airline sector as a whole as the variables affecting the industry are so hard to predict, says Ben Clark, client advisor at TMS Capital. He outlines the headwinds facing this sector.
Financials May Face More Turbulence Ahead
The banking sector is likely to face more turbulence in 2009, warns Andrew Sullivan, sales trader at MainFirst Securities.
Avoid Mainland Banks
Steve Tse, research manager at BEA Union Investment Management recommends investors to steer clear of mainland bank stocks.
Invest in Asia's Emerging Markets
Expect emerging Asian markets to outperform their global peers by the end of the current quarter, says Sean Darby, head of regional strategy at Nomura International.
Upbeat on Singapore
Although Singapore is the first Asian economy to slip into a recession, it looks attractive to Michael Foo, head of portfolio management, Asia at Clariden Leu.
Thai Stocks Offer 'Best Value'
The current political unrest should not deter one from investing in Thailand as Sean Darby, head of regional strategy at Nomura International believes Thai firms offer some of the best payout ratios at extremely cheap valuations.
Volatility Seen Easing in Australia
The Aussie market will be a lot less volatile than its peers, says Peter Dobrijevic, portfolio manager at Adam Smith Asset Management.
Is BHP Billiton a "Buy"?
Pick up BHP Billiton on any further weakness in its share price, suggests Greg Canavan, head of Australasian research at Fat Prophets.
Pick Quality Stocks like Heinz
Investors should start to look for companies with strong balance sheets and good business models like H J Heinz as the current valuations are very attractive, James Bevan from CCLA Investment Management told CNBC.