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Equities in Asian emerging markets regained some footing on Tuesday after a brutal global sell-off a day earlier, but trade was cautious as investors contend with the unwinding of yen carry trades and worries over a slowdown in the United States.

An MSCI gauge of Asian emerging market equities outside of Japan rose as much as 1.7% to mark its best day since early June, after sliding 4.2% on Monday. An index which includes Japan bounced 3% as the Nikkei staged a solid recovery.

Tech-heavy indexes Taiwan and South Korea’s KOSPI bounced up to 4% and 5.6%, respectively. The KOSPI marked its best intraday gain since early November last year.

In Southeast Asia, equities in Indonesia, Malaysia, and Thailand added between 0.2% and 1.5%, although Singapore’s FTSE Straits Times fell 1% on pressure from banks.

An unwinding of yen carry trades, lukewarm tech earnings, and fears the U.S. could be sliding into recession convulsed equity markets on Monday as investors dumped riskier assets and moved into safe-haven bonds.

“(Monday’s) price action seems somewhat exaggerated from a fundamental perspective, and should be partially viewed as positioning adjustments and also deleveraging by investors who have borrowed cheap money excessively,” Michael Wan, senior currency analyst at MUFG, said.

Asian stocks tank after US data fans recession fears

“While we do not think that market trends should be linearly extrapolated from here, this is not to say that the deleveraging dynamics will not continue.”

Analysts at Maybank in a client note late on Monday warned of a “period of significant macro transition as the world now adjusts to a phase of a global easing cycle”.

Currencies in the region retreated as the dollar edged higher in Asian trading hours, coming off of the near seven-month low it touched on Monday. That sent the Asian currencies lower, with ringgit leading the pack.

The Malaysian ringgit gave up 1% after surging 2.3% to its highest level since April last year in the prior session.

The unit has seen stellar growth since mid-April, advancing about 7% on a slew of factors including political stability and growing foreign interest. It is the only regional currency in positive territory so far this year with nearly 3% gains.

Elsewhere, Taiwan’s dollar, the Philippine peso, South Korea’s won, the Thai baht, and Indonesia’s rupiah largely lingered near their previous closing levels.

Meanwhile, data showed annual inflation in the Philippines accelerated at a faster-than-expected pace in July. After the data, the central bank’s governor said an easing of policy rates at its meeting next week would be “a bit less likely”.

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