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Overinflated Prices May Move Stocks Lower in 2010

January 3rd, 2010

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Nikkei Since 1970s

Digital News Report – With Taiwan stocks higher two days in a row before the New Year’s holiday, investors are expecting a modest decline at the opening of trading on Monday.

Government intervention and stimulus measures brought investors back to the market prompting Asian stocks to lead the 2009 rally in prices. But higher commodity prices may drive investors away from stocks.

Asian stocks also suffered heavier losses during the 2008 sell-off, so it was expected to show some of the better gains. Both equities and gold benefited from government intervention.

Since March some shares gained 80 percent or more. But experts warn that 2010 may not be as rewarding because of over-inflated prices.

By Tina Brown

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