Emerging markets are starting to outperform again as early indications suggest that their central banks are getting ahead of the curve on constraining excess liquidity and credit growth. We continue to believe in emerging markets' long-term growth story, which is largely contingent upon growing demand from a burgeoning middle class and supported by steady productivity and wage gains. Hence, we maintained a core strategic overweight although we have been tactically underweight given emerging countries' central bank tightening. Moreover, the recent emerging markets' relative underperformance make them well positioned in our Price Matters context to add value for investors amid portfolio rebalancing. Thus, we are adding to our emerging markets positions.

David Fuller's view Whether we call them emerging, progressing or growth markets, some of the better performers in Asia combine rapidly developing assembly and light manufacturing industries, plus large agricultural sectors. Indonesia, Malaysia, The Philippines and Thailand are leading examples. All of them are currently trading well above their 2008-2009 peaks, having successfully completed mean reversion corrections towards their medium-term trends, approximated by the 200-day moving averages shown on the weekly charts above.

An important factor in their success is that they supply many of the resources that China needs, as do all countries which are major exporters of commodities. Consequently, the overall health of China's economy remains crucial to the prosperity of its main suppliers.

I would like to have a shrinking dollar, euro or pound for every bearish report that I have seen on China over the last decade, most of which are published in the west. China will have its periodic problems with inflation, overbuilding, speculation and corruption, just like every other country. A factor behind some of these bearish reports, in my opinion, is that while many people are in awe over what China has achieved, plenty of them also fear China's competitiveness. This does not improve their analysis.

Meanwhile, China is setting many more records for success than excess. This is a long-running theme at Fullermoney, to which we will return frequently and as required. To remain objective, we seek out reports and views on China from people who know it far better than I do.

I met one of them here in London last week - Yang Liu who was making a brief visit. She runs the China funds at Atlantis Investment Management, in which I have invested for a number of years, and she now owns the Company. Yang Liu shares Fullermoney's view that China's stock market is completing a lengthy consolidation caused mainly by new supply from the government. That heavy issuance no longer hangs over the market. She likes the overall valuations which are back at levels last seen in 2005, before the big advance, and again in 4Q 2008 following the global bear market. I will review charts of China' main share indices on Thursday.