Edit in JSFiddle

function MyViewModel() {
    var self = this;
    self.lastInterest = ko.observable();
    self.places = ko.observableArray(['London', 'Paris', 'Tokyo']);

    // The current item will be passed as the first parameter, so we know which place was hovered over
    self.logMouseOver = function (place) {
        self.lastInterest(place);
    }
}
ko.applyBindings(new MyViewModel());

<ul data-bind="foreach: places">
    <li data-bind="text: $data, event: { mouseover: $parent.logMouseOver }"></li>
</ul>
<p>You seem to be interested in: <span data-bind="text: lastInterest"> </span>
</p>