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. Last Updated: 07/27/2016

Asian Markets Expect Prosperity

SINGAPORE -- If the pundits are right, the year 2000 could be a happy one for major Asian stock markets, thanks to economic recovery and demand for undervalued stocks.

A Reuters poll of six key Asian markets f Tokyo, Hong Kong, Singapore, Seoul, Taipei and Sydney f showedexpected gains of 4 percent to 34 percent between Tuesday's close and the end of next year.

Seoul, Singapore, Hong Kong and Sydney are projected to finish out 2000 at record highs.

This is on top of double-digit rises, in local currency terms, for all the stock indices so far in 1999.

This year's best-performing Asian stock index, Seoul's KOPSI, could again ratchet up the sharpest gains by the end of 2000, the poll found.

Restructuring of the debt burdened corporate sector, strong economic growth and an increase in stock ownership are expected to underpin the South Korean market's rise, the survey found.

"Investors will turn to the stock market as depositing money with banks loses merit in line with falling interest rates," said Lee Jeong Ja, head of research at HSBC Securities.

Forecasted gains for the other markets, ranked in descending order of expected percentage gains, were Taipei, Hong Kong, Tokyo, Singapore and Sydney.

Asia's largest market, Tokyo, up 31 percent from the start of the year at 18,166 as of Tuesday, was seen ending 2000 at 21,000. By comparison, the Dow is up about 22 percent.

"The Nikkei average is likely to breach and stay above 21,000 for the first time since 1991," said Craig Chudler, Japanese equity strategist at Nikko Salomon Smith Barney. "Both economic growth and corporate earnings are positive, and accelerating."

A post-recession earnings recovery and healthy balance sheets could lift Hong Kong's Hang Seng index to 18,887 by the end of 2000, the poll found.

That would put it up 16 percent from Tuesday's closing level, and at a record after a gain of 62 percent so far in 1999.

"We believe that Hong Kong is emerging from its recession in a reasonably meaningful fashion and we believe that analysts are underestimating earnings forecasts for the conglomerate sector, the banks sector and even the property sector," said Ajay Kapur, regional strategist at Morgan Stanley Asia.

Singapore's stock index, already at historic highs, can expect to hit 2,637 by the end of 2000, survey showed. The Straits Times Index closed Friday at an all-time high of 2,395.44.

The poll showed expectations that the STI would gain 11 percent by the end of 2000 from Tuesday's close on top of the 70 percent rise to Tuesday's close.

Australia's stock market is the laggard of the group.

Despite a strong rise in company earnings, rising interest rates are seen reining in the pace of growth.

Analysts expect the All Ordinaries index will finish out 2000 around 3,234, for a rise of about 4 percent measured from Tuesday's close.

Australian shares were up 10 percent for the year as of Tuesday.