Bloomberg Daybreak: Asia Edition
Emerging Market Outlook; Traders Gear Up for US CPI
Feb 12, 2025
Ben Luk, Senior Multi-Asset Strategist at State Street Global Markets, shares his insights on the evolving landscape of emerging markets, highlighting cautious institutional interest in Chinese assets despite local uncertainties. Adam Turnquist, Chief Technical Strategist at LPL Financial, discusses the implications of Federal Reserve policies on market trends and inflation, particularly ahead of the key U.S. CPI report. The conversation dives into strategic investment approaches in a rising yield environment, emphasizing specific sectors that may thrive despite economic challenges.
19:16
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Quick takeaways
- Emerging markets are attracting investors due to improved valuations and the potential for growth amid recent stability efforts.
- Trade dynamics, especially between the U.S. and China, pose challenges for inflation and market expectations, affecting investment strategies.
Deep dives
Understanding Emerging Markets
Emerging markets (EM) have become increasingly interesting to investors, primarily due to attractive valuations and adjusted positioning after several years of underperformance. Many institutional investors had previously avoided substantial holdings in major EM countries, which has resulted in low allocations currently. There is a sense that as some of these countries stabilize and navigate challenges, there may be opportunities for growth. For instance, recent inflows into Chinese-related assets suggest a cautious optimism among investors looking to capitalize on potential rebounds.
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