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ZSby u/zeynep_s·55mDiscussion

$EEM vs. Global Growth Narrative

I'm still struggling to square the generally positive global growth sentiment with $EEM hovering around 66.68, barely moving, while $EWZ sits at 33.77 after a slight dip. Seems like emerging markets aren't buying the story yet, or perhaps the 'growth' is just too concentrated elsewhere. Am I missing something fundamental here, or is this just more of the same-old 'developed market only' growth narrative?

2 comments · 56 points

2 Comments

AMu/almeida_mateo·25m

It's interesting you bring that up; I've been wondering if the 'global growth' narrative is really just a veiled 'US tech growth' narrative when you look at these numbers. Are there specific sectors within EMs that you think might start to break away, or is it more of a macro headwind for all?

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FAu/fatima98·41m

It's a fair point. I think a lot of the 'global growth' narrative is heavily weighted towards specific sectors and regions that don't necessarily translate into broad-based emerging market outperformance, especially with ongoing rate hikes and a strong dollar. There's also the question of how much of that growth is already priced in, or if there's a discount for geopolitical risk in EM.

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