Opportunity in emerging markets amid falling global growth, says Saxo
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Emerging markets have been battered by a debt-induced perfect storm, a dizzy US dollar and crumbling commodities prices. However, according to Saxo Bank’s Essential Trades for Q4, there is hope – and investment opportunity. This is despite the fact that the pretend-and-extend cycle of denial persists, whereby the same experiment is being repeated with the expectation of different results. Saxo's Chief Economist Steen Jakobsen thinks EMs overall are a buy. He said the perfect storm raging through emerging markets is also the biggest opportunity in decades. Saxo Capital Market’s Asia Macro Strategist Kay Van-Petersen argues that although many feel the sell-off in emerging markets is overdone and we have seen the lows, he begs to differ. He says the structural EM currency devaluation, continued commodity bear market conditions and the global shutdown are likely to catch up with EM equities and bonds. At the same time, he believes developed markets will outperform emerging markets over the next few quarters, perhaps even for a year down the line. Read more: (VIEW LINK)
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