HONG KONG -- Just a few months ago, investors couldn't get rid of their Asian stock holdings fast enough.
Amid fears the Asian crisis was worsening, they dumped shares, sending already beleaguered markets to lows unseen in years. But anybody looking at Friday's closing values might think they were looking at different markets.
Prices have surged over the past few weeks, although analysts wonder if investors are being overly optimistic at a time when they just can't see anything better to do with their money.
Finding themselves sitting on a cash pile from the selloff, traders started looking around for something to invest in and found that nothing looked more promising than the stock markets. So they piled right back in.
"It's what I call a conceptual rally," Robert Rountree, managing director of Prudential-Bache Securities' Asian research.
The rallies certainly haven't been based on any fundamental strengthening of battered economies -- though they may reflect a belief that things have finally bottomed out and can only get better.
In August, financial turmoil in Russia and Brazil seemed to indicate that Asia's financial crisis was erupting into a global meltdown, but by mid-September, investors figured Asian stock markets were heading no lower so it was time to scoop up the bargains.
The U.S. Federal Reserve's three interest rate cuts from September to November fueled the buying, dragging even reluctant investors into the market.
Since hitting a string of low points, the biggest markets in Asia -- Tokyo, Hong Kong and Singapore -- have staged strong comebacks, as has the Dow Jones industrial average in New York. Other Southeast Asian markets have also posted significant gains.
On the top market, Tokyo, the Nikkei Stock Average of 225 selected issues has increased 12.4 percent since it fell to 13,406.39, on Sept. 30, its lowest point in 12 years. The Nikkei closed Friday at 15,069.39.
Singapore's benchmark Straits Times Index, which dropped to a low of 800.27 on Sept. 4, has since risen 74 percent to close at 1,394.76.
Analysts are quick to point out that there are no fundamental economic changes to support such gains. Moreover, once the economies do begin to recover, higher corporate earnings may not pan out for two to three years.
The economies of South Korea and Malaysia, for example, are both forecast to shrink by about 6 percent this year, but their stock markets have nearly doubled in value since hitting bottom.
"The ingredients for recovery are not there," said Paul Schulte, Asian regional strategist for ING Barings Securities (Hong Kong) Ltd.
The Hong Kong economy, for example, is expected to contract by 5 percent this year, according to government forecasts.
But Hong Kong blue chips have shown a 61 percent gain since hitting a 5-year low in August. Much of the rise was spurred by the government's controversial intervention in the market, a two-week buying spree designed to prop up the market and chase away speculators. Interest rate cuts also sent the market soaring even higher.
When the markets started to show signs of recovery, some fund managers, who were not ready to come back to stocks, were "squeezed into the market" anyway, Rountree said. Some were holding about a quarter of their portfolios in cash and needed to try to increase investors' returns.
Analysts are not in agreement over just how long this rally will continue because Asian economies and corporate earnings are not expected to turn around for another two to three years.
Anthony Chan, chief regional economist for HSBC Securities Asia Ltd. in Hong Kong, called the rally quite sketchy, "given no major revisions in earnings or growth forecasts."