Emerging market Snapshot from HEXAM

HEXAM Capital - the UK's leading emerging markets boutique - is delighted to attach the January issue of the HEXAM Emerging Markets Snapshot.

Key points to emerge in January's Snapshot below: Fall in risk spreads and rise in commodity prices mean a positive start to the year for EM equities.

HEXAM remains positive on China, with 9% - 10% growth anticipated for 2010.

Turkey has moved from negative to neutral, helped by hopes of an IMF deal and Fitch rating upgrade.

HEXAM remains negative on Mexico and South Korea.

Lofty valuations and extent of the run up in markets means short-term direction is uncertain.

Bryan Collings, Managing Partner, HEXAM Capital says: "At HEXAM, we believe that, given the prevailing fundamental picture, the extent of the run up in markets and the lofty valuations means that the short-term direction remains far from certain.

"It seems that the return to higher volatility may have predictive value for the next few months, hence our continued focus on stocks with earnings visibility and reasonable valuations.

We continue to remain cautious on the outlook for emerging equities as we believe the risk-reward balance is increasingly unattractive given prevailing valuations.

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