(Bloomberg) — Monday’s moves in emerging markets may look unexceptional. Drill down, however, and signs of an intriguing shift emerge.
The benchmark gauge for emerging-market stocks is down 0.5% and its currency counterpart is little changed. That suggests investors are biding their time as they weigh the proliferating risks, from a technology-sector meltdown to U.S.-China tensions.
But broader indexes that average out market moves can mask regional, sectoral and asset-class differentiation. That’s what seemed to be happening since the Thursday selloff in the Nasdaq 100 Index.
There are signs that the laggards of the past five months — currencies as well as stocks outside Asia, especially in non-technology sectors — are starting a phase of outperformance. That is not to say an unqualified rally is on the cards, but just that these assets could perhaps weather the coming volatility better.
Risk Signals Increase in Emerging Markets Starved of