China

Chinese stocks took a severe hit as the threat of a credit crunch in China escalated and the country's central bank threatened to continue its credit-tightening policy.

Emerging markets face a tough summer but this could lead to an entry point for investors at the end of Q3, said Jupiter's Kathryn Langridge.

ASIA

GOSLING'S GROUSE

CHINA

Funds with heavy exposure to financials are at the bottom of the IMA China sector over six months, as China's banking reforms caused a savage sell-off in financial stocks.

This week has seen further volatile moves in markets - particularly within fixed income as investors unwind positions in government and emerging debt - while Chinese equities also hit the headlines on fears of a slowdown in the country.

Mike Riddell, bond fund manager at M&G, has warned if emerging market debt outflows continue at their current pace or worsen, the effect on the asset class is likely to be "cataclysmic".

Richard Wilmot is underweight financials and mining stocks in his Newton Higher Income fund on fears about the impact of the underperformance of Chinese and wider Asian markets.

Global equities climbed overnight as poor growth figures from the US allayed fears the Federal Reserve will soon slam the brakes on its stimulus programme.