It’s Always the Right Time for EM
Emerging market equities can provide both return and diversification benefits, but only with a consistent and meaningful portfolio allocation.
China’s Domestic Stock and Bond Markets a Vast New Frontier for Foreign Investors
Under-owned relative to the size of its economy and among foreign global money managers, the Middle Kingdom’s capital markets represent incredible opportunities, and new challenges. Tread carefully.
Post-Pandemic Emerging Markets Set to Snap Back Strongly in 2021
Emerging market equities should catch a lift in the year ahead as tactical and structural tailwinds align to drive accelerating economic and earnings growth. But a stylistically balanced approach is crucial to handle inevitable market turbulence.
Are Emerging Market Equity Strategies a Bet on China?
China and Chinese tech companies are a significant part of the emerging market equities index, and for good reason. But disciplined portfolio diversification and balance can effectively manage risk exposures.
Digitization Drives Transformation of Key Sectors in Indian Economy
Digitization in banking and retail comes in the wake of a massive cellular network rollout, creating attractive investment opportunities in India.
The Salutary Effects of Coronavirus-Stricken Energy Prices
While energy investment retrenches in the wake of COVID-19's historic impact on oil and gas markets, consumers will benefit as economies reopen. Selective and patient investors should too.
Prognosticating China's Coronavirus-struck Markets
If the novel coronavirus' spread hurts some industries, others are positioned to benefit from the fallout. Examining the short- and long-term implications of the virus' effect on global supply chains.
Yet Another Year of Bullish Emerging Markets Calls? Why This Time Is Indeed Different
Exogenous factors often knock well-positioned markets temporarily off track, sometimes repeatedly. But dislocated share prices ultimately re-align with business fundamentals, earnings growth and attractive valuations.
Despite “Phase One,” U.S.-China Trade Dispute Likely to Linger
As “strategic competitors,” bilateral friction won’t go away anytime soon, but extensive economic integration and shared interests should facilitate longer-term accords and investment.
The Bright Side of China’s Equities amid Trade War, Hong Kong Protests and Slowing Growth
China's GDP is changing, and creating new investment opportunities. Thornburg PM Lei Wang discusses the outlook for Chinese stocks, the market implications of the political turmoil in Hong Kong and prospects for European equities.
Rising LNG Tide Changes How It’s Priced and Traded
Supply and demand growth in liquefied gas benefits some producers more than others. For investors in U.S. upstream gas producers and Gulf Coast LNG infrastructure, caveat emptor.
Drilling into Oil Market Investing after the Attack on Saudi Arabia
Longer-term investors should focus on an energy company's structural advantages in terms of asset base quality, operational efficiency and financial discipline, not the price of oil and gas.
Brazil's Flight of the Chicken
The market has bid up Brazilian assets in anticipation of economic reforms, but the optimism should be well measured and individual securities well picked.
Dollar Headwind to Emerging Markets Equities Lifting, Though Trade Dispute Still Drags
After a turbulent May, China and emerging markets appear poised to resume their ascent from the first quarter, even as trade-related air pockets remain likely.
Emerging Market Stocks Still Have Room to Run
Despite sprinting higher so far this year, developing country equities appear well positioned to sustain their momentum, and with less volatility.
After Falling Back to Earth, Emerging Markets Ready to Take off Again
Will emerging markets stocks rebound in 2019? Attractive valuations, strong forecast earnings growth, structural reforms, and an abating dollar headwind suggest they will.
From China to Mexico to Brazil, Headline Noise Obscures Underlying Emerging Market Drivers
Positive catalysts are in place in all three countries, and across emerging markets valuations and earnings expectations make for a potential rebound in 2019.
Who’s Afraid of an Emerging Markets Meltdown?
Deep declines are usually followed by rebounds that leave emerging market stocks with gains by year end, as the structural tailwinds are driven by steadily expanding middle classes. Meaningful, consistent exposures to the asset class are key to capitalizing on the long-run double-digit returns.
Report from Turkey: Cheap Asset Prices May Not Be Cheap Enough
Turkish asset prices have plummeted this year, bringing their valuations to historically low levels. That presents potentially attractive opportunities to investors looking for quality stocks at bargain-basement prices.
Oil Price Shifts Into Overdrive
Supply and demand dynamics, along with political fuel injection, may keep crude prices running hot.
Emerging Markets Rise, Fall, Repeat
Emerging market stocks are trading near bear market territory, but that's par for the course for longer-run, rising returns.
Hedging Foreign Currency Exposure vs. Accepting Unmitigated Foreign Currency Risk
Many forces undercut and bolster the greenback. Rather than accepting unknown risk around its near- or long-term direction, dollar-based equity investors may be better served using currency hedges so they can focus more on the individual merits of overseas securities.
A More Demanding Powell Put to Test EM’s Strengthened Mettle
The Fed chairman makes clear the bar for slowing monetary tightening is higher nowadays, and argues emerging markets are much better positioned to handle higher U.S. yields than they were before.
The Weak U.S. Dollar Puffs Up Overseas Equity Returns
Yet the earnings potential of developed and emerging markets stocks is real, since they are at earlier points in their respective business cycles.
Understanding The Confucian in Xi's Populism
China has dropped norms to allow President Xi Jinping to remain in power after his second term ends. While worrisome at first blush, the populist turn and consolidation of power likely has near-term economic and financial market benefits, and longer-term political risks.
Emerging Market ETFs Traded Reliably During Selloff. But What about their NAV Disconnects?
EM ETFs suffered deviations in their market prices relative to their net asset values, with their total returns materially underperforming the broad emerging market index.
Why Samsung Can Be an Apple of Investors’ Eyes
Samsung is no longer a stodgy conglomerate (or chaebol in Korea) that just makes consumer and industrial electronic devices and equipment, along with some home appliances. Its sales of semiconductor chips and panels account for nearly half of total revenues.
Mexico’s Central Bank Hikes Key Rate In Hawkish Turn
The Central Bank of Mexico has raised the policy rate a quarter point to 7.25%, its highest level in nearly nine years. Banxico, as the Mexican monetary authority is known, had been widely expected to...
Emerging Market Performance Dispersion Set to Rise After Strong 2017
Emerging market assets have mostly had a gangbuster 2017 across the board, from stocks to bonds and currencies. But some macroeconomic headwinds and "idiosyncratic" or country-specific risks...
India Takes a Page Out of the TARP Playbook
In an unexpected move, the government of India has announced a $32 billion plan to recapitalize the country's sour-loan laden public sector banks, its biggest step so far in addressing a lingering problem...
China's Central Bank Chief Warns of "Minsky Moment"
Investors have looked beyond divisive, populist politics in the U.S., the U.K., Spain, and elsewhere in Europe, focusing instead on accelerating global economic growth and surging industrial metals prices...
As India Crosses the Digital Divide, a New Era of Investment Opportunities Dawns
When can a country's bluechip stocks be a bargain if they're trading at historically high forward earnings valuations after posting world-beating returns over the last two decades? Right now, if they're Indian ...
Investing In EV Carmakers and Supply Chains? Utility Work Ahead
Future growth projections for electric vehicles vary dramatically, but all reflect real opportunities for fundamentals-focused investors surveying the links in supply and production chains.
North Korea, U.S. Rhetoric Rattle Markets, But Investors Should Ignore the Noise
Geopolitics is shaking global markets, with the epicenter of the latest tremors coming from the Korean Peninsula. Fiery rhetoric out of Pyongyang is nothing new. But it is certainly novel coming from the...
Breaking Down the Presumed Correlation Between Commodities and Emerging Markets
Among the lingering misconceptions about emerging markets is that they are proxy plays on commodities, prices of which presumably drive returns in developing country stocks. Historical...
The Incentive Factor Behind MSCI’s China A Shares Index Inclusion
If China is a master of incremental reforms to gain admission to select economic and financial circles, only to bend the rules after access is granted, MSCI appears well aware of its playbook. Whether...
China's Steel Industry Shrinks to Grow More Efficient
China's Baosteel Group is now the second-largest steel company in the world after ArcelorMittal, but it is the undisputed leader in the Middle Kingdom, where roughly half the world's steel is produced. I...
Brazilian Markets Tumble as Political Turmoil Returns
Brazilian asset prices tanked May 18 following a local media report implicating President Michel Temer in alleged hush-money payments to former lower house Speaker Eduardo Cunha, who is now...
Mexican Market’s Reprieve from Political Ferment to Be Short-lived
The political squalls blowing from north of Mexico's border took a heavy toll on the Aztec nation's asset prices at the beginning of the year, but as we noted a few days after Donald Trump, whose...
South Korea Tacks Left With New President, But Stocks Have Other Drivers
After nearly a decade of conservative administrations, South Koreans have elected a leftist human rights lawyer as president. Moon Jae-in's pledges to take a conciliatory tact with Kim Jong-un's volatile regime...
Underinvestment and Demand Growth Will Help Sliding Oil Prices Recover Footing
After falling more than 6% in a week, oil prices pared their losses Friday, May 5, rebounding 1.6% as the "tug of war" between Organization of Petroleum Exporting Countries (OPEC) and U.S. shale...
Tailwinds to Emerging Markets Resurgence?
In contrast to last year's volatility in the first quarter, global equity markets showed strong returns during the first three months of 2017. Economic indicators and earnings around the world are beating...
China’s Li Keqiang Index Flexing its Muscle
Chinese Premier Li Keqiang once told a U.S. diplomat that China's official GDP data was "man made," according to Bloomberg. To glean more accurate measures of growth, he instead looked at...
Investors Should Look Beyond South Africa's Unfolding Political Drama Now
South Africa's political tensions intensified on March 30 following President Jacob Zuma's sweeping cabinet reshuffle, which included replacements of respected finance minister Pravin Gordhan and his deputy ...
Energy Goldilocks? Growing Oil Demand, High OPEC Compliance Meet High Inventories and Growing Non-OPEC Output
The International Energy Agency (IEA) Friday reported the best compliance on an oil output cut agreement in the history of the Organization of Petroleum Exporting Countries (OPEC). While this is...
India's Pragmatic Populism
For a country steeped in its customs, India's government and central bank have taken a liking to the element of surprise. The policy announcements have been far from pleasant, causing people...
What’s Worked Lately in EM isn’t What’s Worked Long Term
Over the last 10- and 15-year periods, the MSCI emerging market consumer discretionary, consumer staples, and health care sectors have massively outperformed energy and materials. This...
Ride the Dollar Tide at Your Risk
After three straight years of declines, developing country stocks regained some ground in 2016. Yet the MSCI Emerging Market Index's 11.2% total return in 2016 came with marked volatility along...
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