*
Massive sell-off should have seen its peak, but markets remain volatile; sideways movements could happen within wide bandwidth*
Low level of indebtedness makes exposure to deleveraging-driven crisis lower in CEE. Growth rate differentials to Western markets still standing*
Investors to watch balance sheet quality, stick to defensive sectors, favor Austria, Czech Republic, Poland
As the crisis continued through 2008 Erste Group analysts point out that the market has been searching, if not for a turning point, for a bottom at least. They say fund flows and stock exchange turnovers indicators show that the massive sell-off should have seen its peak.
“We believe that markets have found a resting point but will remain volatile,” says Henning Esskuchen, head of CEE equity research at Erste Group. “Despite volatility having settled down, it is still at extreme highs and we expect markets to move sideways for a while in general. This could still happen within quite a wide bandwidth.”
For more detailed information please go to http://www.erstegroup.com
D.C.