Pitfalls Lie in Wait for Emerging Markets After Bumper Month
- Key threat is from potentially hawkish Fed pivot, analysts say
- Taiwan election in January may heighten US-China tensions
Customers wait in line outside a Banco Galicia bank branch in the financial district of Buenos Aires, Argentina, on Nov. 21.
Photographer: Erica Canepa/BloombergThis article is for subscribers only.
Emerging-market stocks and currencies are heading for their best month since January, but there are major pitfalls ahead that could derail the rally.
The headwinds in coming months include the risk of renewed Federal Reserve hawkishness and elections in key markets such as Taiwan and India. There’s the threat of drastic economic change under Argentina’s new president and a referendum in Chile that could spark riots. Finally, November’s big gains alone create the chance of a pullback.