Volatile Asian Market Worries IMF

NEW YORK CITY: Despite a record surge that saw markets in Hong Kong and Indonesia jump by more than 7 percent Wednesday, international money managers remain concerned about stability of economies throughout Southeast Asia, says TIME business reporter Bernard Baumohl. Last month's Thai currency crisis has International Monetary Fund managers sufficiently spooked to put the prospect of a major banking collapse in shaky Southeast Asian markets atop the agenda of this month's IMF meeting. "These countries aren't experienced in financial calamity," says Baumohl. "They really don't know how to protect themselves, and may not even have the resources to do so."

After the Dow posted a record 257-point gain yesterday, investors in Southeast Asian markets pushed ahead. Hong Kong's Hang Seng index had it's biggest point gain ever, soaring 978.66 points to close up 7.13 percent at 14713.99. Markets from Australia to Taiwan also recorded strong gains.

But despite the news, many fear that the region's decade-long expansion is coming to an end. "It certainly looks like people were overly optimistic about the Southeast Asian economies," says Baumohl. "They pegged their currencies close to the U.S. dollar, but they didn't have the same strong conditions there that the U.S. is experiencing." In a surprise effort to stop the slide, Malaysia last week restricted stock trading. But that further scared investors, worsening the fall.