WHERE have all the bears gone?

Just a few months ago in March, they were out in full force but now they seem to have gone into deep hibernation.

Even the most pessimistic investor is unlikely to have resisted making a foray into the market, given the breathtaking resurgence of regional markets since March.

Asian markets could scale new recovery heights in the coming weeks, due to a bright earnings season and upbeat Chinese economic data out this week.

'The panic of a year ago is continuing to be reversed,' said Mr Shane Oliver, head of investment strategy and chief economist at AMP Capital Investors. 'The bears who have stayed on the sidelines have had to buy back into risky assets in the face of ever brighter economic data.'

The Straits Times Index crossed the 2,700-point mark to hit a 13-month high last week. It closed at 2,708.12 on Friday, up 55.61 points or 2.1 per cent from the previous week. Average daily volume was 2.01 billion shares valued at $1.5 billion, compared with 2.05 billion shares worth $1.64 billion the week before.

The Singapore market should hold steady or head higher as more earnings results emerge, noted Westcomb Securities research head Goh Mou Lih.

A further climb could be sparked by positive earnings surprises, as the third-quarter reporting season hits full swing starting this week. The likes of Keppel Corp and Keppel Land, several shipping trusts and real estate investment trusts are expected to announce numbers this week.

Overall, the mood is buoyant as investors are becoming less cautious, but far from euphoric.

Last week, the Government raised its full-year economic outlook, as the Singapore economy kept up its quick rebound in the third quarter. The bright numbers spurred fresh belief that other Asian economies will also report numbers showing a fast-paced recovery.

CIMB-GK regional economist Song Seng Wun said: 'There's no nasty news to suggest to stockholders to cash in their chips. The recovery is shaping up nicely, and has been followed up with economic numbers to support that assertion.'

Aside from earnings, Asian investors will also look to Chinese economic figures out on Thursday and Friday for direction.

Data on gross domestic product, industrial production, investment and retail sales will be released, and 'are likely to show that the Chinese recovery is continuing to gather pace', said Mr Oliver.

Over on Wall Street, investors will focus on earnings from top tech firms Apple, Microsoft and Yahoo, Wells Fargo in banking and Boeing in the industrial sector. They will also monitor reports on US housing starts and existing home sales.

Last week, the Dow Jones Industrial Average crossed the 10,000 mark but did not hold above it on Friday. It gained 1.33 per cent for the week to end at 9,995.91.

'Our sensitivity to earnings is very high,' Wells Fargo Securities equity strategist Gina Martin told news agency Agence France-Presse. 'How the market interprets the earnings announcement over the next couple of weeks will determine the direction that we trade.'

alfoo@sph.com.sg