This article was originally published on this site
Listen to this article
This is an experimental feature. Give us your feedback. Thank you for your feedback.
What do you think?
Emerging markets are showing signs of weakness after a barnstorming run for much of the year as the dollar has rebounded.
Beyond pressure on EM currencies, there has been an interesting divergence between bonds and share prices. A firmer dollar has knocked EMB, the iShares exchange traded fund that tracks the JPMorgan EM bond index. In contrast, EEM, the iShares MSCI EM equities ETF, remains in its uptrend. That begs the question as to how long EM equities can ignore the weakness we are seeing in bonds and forex.
Miller Tabak notes: “Unless the dollar rolls back over in a significant way over the coming days and weeks, we would expect the EEM to follow the EMB lower before long.”
Read more FT markets charts that matter to investors here.