Emerging Markets
Our EM strategists are downgrading Brazilian equities from neutral to underweight and advise absolute-return investors to stay clear of Brazilian markets. They maintain underweights in domestic bonds and sovereign credit within their respective EM portfolios.…
Our EM strategists see no case for structural EM equity outperformance and recommend a neutral allocation within global equity portfolios. Outside semiconductor producers and financials, EM profitability sits well below that of US peers and the levels reached…
Outside semiconductor stocks, EM/China profitability has been well below both their US peers and the levels that prevailed during the EM structural bull market in the 2000s. Over a 3- to 5-year horizon, EM/China relative equity performance versus global will be range-bound.
Our Global Investment strategists argue that China must lower national savings to reduce investment without increasing unemployment. China does not produce too much; it spends too little. Malinvestment is a genuine problem, but it reflects the deeper…
MacroQuant recommends a slight underweight position in equities, and favors a below-benchmark duration stance in fixed-income portfolios. The model is very positive on the US dollar, neutral on gold, constructive on copper, and very bullish on oil.
Mexico still looks attractive on a cyclical horizon, but the lack of productivity growth argues against a secular bull market. Our Chart Of The Week comes from Max Malak, from our Emerging Markets team. Our EM team is bullish on Mexican assets: Tariff…
MacroQuant recommends underweighting equities and adopting a benchmark duration stance in fixed-income portfolios. The model is very positive on the US dollar, bearish on gold, neutral on copper, and bullish on oil.
Our clients are most constructive on LatAm Banks and the Korea & Taiwan semi cycle. In last week's poll, we asked where investors see the greatest upside across three EM themes. BCA clients are split evenly between LatAm Banks and Korea & Taiwan (40%…