Battered Emerging Market Stocks Could See a Turnaround Soon
- Sentiment indicators augur possible stock gains: Merian Global
- Strong U.S. consumption will aid emerging markets: Barings
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A combination of poor investor sentiment and expectations of continued economic stimulus suggest that battered emerging market equities could soon see a turnaround.
Continuing U.S.-China trade tensions and a slowing Chinese economy have dented investor sentiment in the past few months. The MSCI Emerging Markets Index is still down about 8% from this year’s high in mid-April. However, investors are saying that a potential bottoming out of risk-off sentiment and accommodative monetary and fiscal policies mean that flows could start coming back to developing countries.