Benchmark
How Globalization Has Put Emerging Markets in Lock Step With S&P 500
Emerging economies have converged with richer countries over the past decade, and so have their equity markets.
A Historic View of S&P 500 Valuations
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In the age of globalization, diversity is harder to come by. That poses a challenge for an emerging markets investor.
Bloomberg's Stock Correlation Tracker compares the benchmark equity indices in 84 countries with the S&P 500 index over a 10-year period and found that 88 percent of them were positively correlated with the U.S. market index in the first half of this year. That's up from 82 percent a decade ago. Much of this convergence is happening in emerging or frontier markets, where economic growth has slowed dramatically -- moderating closer toward the U.S. pace -- including several Middle Eastern indices that used to move in the opposite direction to the S&P.