Reuters – Emerging stocks and bonds slid in a panic sell-off on Wednesday as hedge funds dashed to unwind positions, but Hungary’s central bank tried to throttle a slide in its currency with a three-percentage point rate rise.

The banking crisis that started in developed markets is leading to steep falls in emerging markets, as investors are forced to retrench, analysts and traders say.

"There is a need for hedge funds to withdraw from emerging markets to cover redemptions that are occurring, it is a reversal of the carry trade that is being unwound at a very rapid rate," said Neil Dougall, chief emerging markets economist at Dresdner Kleinwort.

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FT Alphaville- New figures from Singapore’s central bank bear out the (abundant) anecdotal evidence of the quickening exodus of Asia-focused hedge funds out of Japan and elsewhere and into Singapore.

Reuters reports that assets managed by fund managers in Singapore grew 32 per cent to S$1,173bn ($862bn) last year, driven by a doubling in assets held by hedge funds.

Assets managed by hedge fund managers in Singapore doubled to close to S$80bn in the year, while the number of hedge fund firms in Singapore increased by more than 50 per cent to almost 300, according to the island state’s Monetary Authority. Meanwhile institutional investors such as pension funds, endowments, foundations, companies and financial institutions accounted for 43 per cent of the funds.

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