Emerging markets set for a ‘rally’ after last year’s rout, says strategist

With the U.S. Federal Reserve pledging to be “patient” in future rate hikes, emerging markets should do better this year, and may in fact even have “a decent rally,” one strategist told CNBC on Monday. Last year, economic troubles in Argentina and Turkey, as well as the Fed tightening monetary policy, had caused a selloff in several emerging market currencies. Some emerging market stock indexes also saw steep declines. But those markets should turn around this year, said Mary Nicola, a G-10 fore


With the U.S. Federal Reserve pledging to be “patient” in future rate hikes, emerging markets should do better this year, and may in fact even have “a decent rally,” one strategist told CNBC on Monday. Last year, economic troubles in Argentina and Turkey, as well as the Fed tightening monetary policy, had caused a selloff in several emerging market currencies. Some emerging market stock indexes also saw steep declines. But those markets should turn around this year, said Mary Nicola, a G-10 fore
Emerging markets set for a ‘rally’ after last year’s rout, says strategist Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-02-11  Authors: weizhen tan, -mary nicola, asian fixed income strategist at eastspring invest
Keywords: news, cnbc, companies, rout, market, rally, set, hikes, markets, saw, patient, emerging, strategist, told, em, fed


Emerging markets set for a 'rally' after last year's rout, says strategist

With the U.S. Federal Reserve pledging to be “patient” in future rate hikes, emerging markets should do better this year, and may in fact even have “a decent rally,” one strategist told CNBC on Monday.

Last year, economic troubles in Argentina and Turkey, as well as the Fed tightening monetary policy, had caused a selloff in several emerging market currencies. Some emerging market stock indexes also saw steep declines. Rising interest rates stateside make it harder for emerging economies to service their U.S-dollar debt.

But those markets should turn around this year, said Mary Nicola, a G-10 foreign exchange and Asian fixed income strategist at Eastspring Investments.

“Now that the Fed is going to be patient, we think that EM has a bit to go. If you look at what we saw last year in terms of emerging markets, the EM rout had much to do with the fact that the Fed was hiking,” she told CNBC’s “Squawk Box” on Monday. “Now that the Fed hikes are off the table for a little bit, and the Fed can afford to be patient, EM funding conditions won’t be as tight as it was before.”


Company: cnbc, Activity: cnbc, Date: 2019-02-11  Authors: weizhen tan, -mary nicola, asian fixed income strategist at eastspring invest
Keywords: news, cnbc, companies, rout, market, rally, set, hikes, markets, saw, patient, emerging, strategist, told, em, fed


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Maxine Waters says BB&T and SunTrust merger deserves serious scrutiny

Waters attributed the deal in part to a law passed last year that eased some bank rules implemented in the wake of the 2008 financial crisis. She argued that “this proposed merger between SunTrust and BB&T is a direct consequence of the deregulatory agenda that [President Donald] Trump and Congressional Republicans have advanced.” Waters “asking so many questions that it slows the evaluation of the deal” poses a risk to it going through quickly, he wrote. Waters, a vocal critic of big banks, too


Waters attributed the deal in part to a law passed last year that eased some bank rules implemented in the wake of the 2008 financial crisis. She argued that “this proposed merger between SunTrust and BB&T is a direct consequence of the deregulatory agenda that [President Donald] Trump and Congressional Republicans have advanced.” Waters “asking so many questions that it slows the evaluation of the deal” poses a risk to it going through quickly, he wrote. Waters, a vocal critic of big banks, too
Maxine Waters says BB&T and SunTrust merger deserves serious scrutiny Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-02-07  Authors: jacob pramuk, getty images, bill clark, cq-roll call group
Keywords: news, cnbc, companies, let, eased, scrutiny, em, deserves, democrats, bbt, serious, deal, congressional, financial, suntrust, waters, merger, maxine, passed, banks


Maxine Waters says BB&T and SunTrust merger deserves serious scrutiny

Waters attributed the deal in part to a law passed last year that eased some bank rules implemented in the wake of the 2008 financial crisis. She argued that “this proposed merger between SunTrust and BB&T is a direct consequence of the deregulatory agenda that [President Donald] Trump and Congressional Republicans have advanced.”

The measure passed last year eased regulations on all but the largest U.S. banks. Proponents of the legislation — including 17 Senate Democrats — argued in part that it would save community banks from an unnecessary burden.

In a note earlier Thursday, Cowen Washington Research Group analyst Jaret Seiberg said the deal would likely get approved, but noted that congressional scrutiny could disrupt it. Waters “asking so many questions that it slows the evaluation of the deal” poses a risk to it going through quickly, he wrote.

Waters, a vocal critic of big banks, took control of the panel when Democrats regained a House majority in January. Speaking to CNBC recently, she stressed that she can work with the financial industry.

“Even if you know you disagree with a particular industry, you let ’em in and you let ’em talk to you. It’s always a learning experience,” she said.

WATCH: Rep. Waters meets with Bank CEOs


Company: cnbc, Activity: cnbc, Date: 2019-02-07  Authors: jacob pramuk, getty images, bill clark, cq-roll call group
Keywords: news, cnbc, companies, let, eased, scrutiny, em, deserves, democrats, bbt, serious, deal, congressional, financial, suntrust, waters, merger, maxine, passed, banks


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Why timing is essential when it comes to emerging markets

But let’s not confuse symptoms with the cause of fundamental imbalances aggravated by unhelpful decision-making. The Turkish lira is more than 60 percent weaker this year, while the Argentine peso has more than halved in value. The IIF has also pointed out that at the start of 2018 many EM currencies were overvalued, and therefore vulnerable. The country is running a fiscal deficit — although mostly domestically funded — that is twice the size of Argentina’s; it has now run five consecutive prim


But let’s not confuse symptoms with the cause of fundamental imbalances aggravated by unhelpful decision-making. The Turkish lira is more than 60 percent weaker this year, while the Argentine peso has more than halved in value. The IIF has also pointed out that at the start of 2018 many EM currencies were overvalued, and therefore vulnerable. The country is running a fiscal deficit — although mostly domestically funded — that is twice the size of Argentina’s; it has now run five consecutive prim
Why timing is essential when it comes to emerging markets Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2018-09-18  Authors: joumanna bercetche, yasin akgul, afp, getty images
Keywords: news, cnbc, companies, fiscal, timing, mechanism, deficit, vulnerable, markets, deficits, em, comes, emerging, lira, iif, large, turkey, essential


Why timing is essential when it comes to emerging markets

To be fair, there is an external culprit in the form of the U.S. Federal Reserve, which is steadily tightening monetary policy and reducing its balance sheet, sending the dollar stronger and yields higher. But let’s not confuse symptoms with the cause of fundamental imbalances aggravated by unhelpful decision-making.

Markets have certainly taken note. The Turkish lira is more than 60 percent weaker this year, while the Argentine peso has more than halved in value.

The typical playbook for emerging markets (EM) is that a sharp currency devaluation eventually leads to a self-correcting mechanism — a large balance of payment deficits corrects as imports become more expensive and exports more favorable, or what economists deem a front-loaded adjustment.

Due to this mechanism, some analysts are now beginning to see value in EM. Robin Brooks, chief economist at the Institute of International Finance (IIF), for instance, has observed a large shrinkage in Turkey’s trade deficit of about $40 billion from the second quarter and has concluded that the lira is undervalued.

The IIF has also pointed out that at the start of 2018 many EM currencies were overvalued, and therefore vulnerable. Its models now show that after the large currency depreciation across the spectrum, led by Argentina and Turkey, the EM landscape has become less vulnerable with “only moderate overvaluations remaining for India, Indonesia and South Africa.”

Brazil is another EM to keep an eye on. The country is running a fiscal deficit — although mostly domestically funded — that is twice the size of Argentina’s; it has now run five consecutive primary deficits. With growth in Brazil having stalled in the run-up to October’s elections, TS Lombard analysts Elisabeth Johnson and Larry Brainard have sounded the alarm. “Unless the new administration moves quickly to pass a credible fiscal programme, Brazil runs the risk of following down the same path as Argentina and Turkey,” they said.


Company: cnbc, Activity: cnbc, Date: 2018-09-18  Authors: joumanna bercetche, yasin akgul, afp, getty images
Keywords: news, cnbc, companies, fiscal, timing, mechanism, deficit, vulnerable, markets, deficits, em, comes, emerging, lira, iif, large, turkey, essential


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It’s time to dip your toe back into emerging markets, strategist says

Economic turmoil in emerging markets is creating new opportunities for investors, a fixed income expert told CNBC Thursday. The concerns over emerging markets have been exacerbated given the context of the U.S. economy. Nonetheless, Jones warned that choosing emerging markets at this point should be done “with caution. Earlier last week, another analyst told CNBC’s “Street Signs” that it’s perhaps “too early” to choose emerging markets again. “I think at least in the short term it is too early t


Economic turmoil in emerging markets is creating new opportunities for investors, a fixed income expert told CNBC Thursday. The concerns over emerging markets have been exacerbated given the context of the U.S. economy. Nonetheless, Jones warned that choosing emerging markets at this point should be done “with caution. Earlier last week, another analyst told CNBC’s “Street Signs” that it’s perhaps “too early” to choose emerging markets again. “I think at least in the short term it is too early t
It’s time to dip your toe back into emerging markets, strategist says Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2018-09-11  Authors: silvia amaro, bulent kilic, afp, getty images
Keywords: news, cnbc, companies, trade, strategist, opportunities, told, china, emerging, markets, jones, toe, dollar, dip, turkish, em


It's time to dip your toe back into emerging markets, strategist says

Economic turmoil in emerging markets is creating new opportunities for investors, a fixed income expert told CNBC Thursday.

A spat between the U.S. and Turkey and some surprising moves by the Turkish central bank has led to a sharp sell-off in the Turkish lira this summer. Other emerging economies have also suffered with a strengthening U.S. dollar causing havoc for heavily-indebted nations. More recently, a surprise call for help from Argentina to the International Monetary Fund added to further outflows.

The dollar has surged against the Turkish lira and the Argentinian peso this year, up about 57 and 47 percent respectively.

“Looking at EM (emerging markets) generally it’s actually getting back to more fair levels if you want to start buying again,” Bryn Jones, head of fixed income at investment firm Rathbones, told CNBC’s “Squawk Box Europe.”

The concerns over emerging markets have been exacerbated given the context of the U.S. economy. The U.S. Federal Reserve is on a path to increase interest rates, the dollar keeps on rising, and growing trade tensions between the U.S. and the China spell problems for these economies.

But Jones is confident that all this trouble has created opportunities when trading currencies.

“There are opportunities building in EM … At the moment, the main way we would look to play it would be through hard currency so through the dollar index, where you perhaps can get around 7 percent average yield,” he said.

Jones explained that the best way to play it via the dollar is by investing in third-party funds, including short-term bonds, that are denominated in dollars and could offer yields of about 8 percent.

Nonetheless, Jones warned that choosing emerging markets at this point should be done “with caution. You’re dipping the toe back in and not just piling in.”

Earlier last week, another analyst told CNBC’s “Street Signs” that it’s perhaps “too early” to choose emerging markets again.

“It is still a cautious and nervous risk environment and I think the next couple of weeks, especially when it comes to U.S. trade and foreign policy, there are still a couple of hurdles that we still have to get through. Not just China, but you have Russia sanctions as well,” Viraj Patel, foreign exchange strategist at ING, said Tuesday.

There are fears that the United States will slap new trade tariffs on China, which could represent further problems for emerging markets. Generally speaking a slowdown in the Chinese economy could spread to other smaller economies.

“I think at least in the short term it is too early to jump back in EM (emerging markets),” Patel added.


Company: cnbc, Activity: cnbc, Date: 2018-09-11  Authors: silvia amaro, bulent kilic, afp, getty images
Keywords: news, cnbc, companies, trade, strategist, opportunities, told, china, emerging, markets, jones, toe, dollar, dip, turkish, em


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Scariest part of emerging markets panic for individual investors: They may be the last to sell

There are two ways to view the surprising stickiness of assets in emerging markets funds: Investors are sticking to the long-term investing mantra and know that emerging markets will go through periods of volatility, or the worst is yet to come. Even emerging markets bond funds are proving resilient, with the iShares J.P. Morgan USD Emerging Markets Bond ETF (EMB) taking in over $1 billion this quarter. “In my experience, retail investors generally do not sell fixed-income funds until payouts ge


There are two ways to view the surprising stickiness of assets in emerging markets funds: Investors are sticking to the long-term investing mantra and know that emerging markets will go through periods of volatility, or the worst is yet to come. Even emerging markets bond funds are proving resilient, with the iShares J.P. Morgan USD Emerging Markets Bond ETF (EMB) taking in over $1 billion this quarter. “In my experience, retail investors generally do not sell fixed-income funds until payouts ge
Scariest part of emerging markets panic for individual investors: They may be the last to sell Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2018-09-05  Authors: eric rosenbaum, chris mcgrath, getty images news, getty images, james leynse, corbis historical, roger wright, brendan mcdermid, michael nagle, bloomberg
Keywords: news, cnbc, companies, investors, panic, remain, sell, funds, etf, emerging, em, scariest, assets, emb, retail, markets, individual


Scariest part of emerging markets panic for individual investors: They may be the last to sell

There are two ways to view the surprising stickiness of assets in emerging markets funds: Investors are sticking to the long-term investing mantra and know that emerging markets will go through periods of volatility, or the worst is yet to come. Because investors have not bailed on emerging markets positions — and it has been a popular trade this year, second only to the iShares Core MSCI EAFE ETF (IEFA) among all ETFs, with $10.7 billion in new assets — the exodus could still be in the making, a position that has been taken by several investment shops that are expecting the panic to hit more broadly. The number of days from peak to trough in the current EM selloff is a longer period of decline than any for the asset class since the financial crisis, including the taper tantrum of 2013, when fears of Federal Reserve post-crisis policy change spooked investors.

Even emerging markets bond funds are proving resilient, with the iShares J.P. Morgan USD Emerging Markets Bond ETF (EMB) taking in over $1 billion this quarter.

“That is a surprise,” said Nick Colas, co-founder of DataTrek Research. He said that retail investors may be holding on to EM bonds because the payouts remain high, and a time when the search for yield has led investors to riskier assets. While EMB is down roughly 6 percent this year on a price basis, it is yielding 4.7 percent. EMB has not cut its payout (44 cents paid on 8/1). “In my experience, retail investors generally do not sell fixed-income funds until payouts get cut. Capital gain/loss is less important to them. We’ll see if that holds true with further losses,” Colas said.

There is reason to worry. Even though most developing countries are not as fragile as Turkey and Argentina, the dollar this year has risen against all major emerging markets currencies, except the Mexican peso, and the trend may continue with the booming U.S. economy and rising interest rates in the United States, according to Neena Mishra, director of ETF research at Zacks Investment Research.

“Most advisors recommend some allocation to emerging markets in core portfolios, and so we may not see a big exodus from broad EM ETFs. Countries that accumulated too much dollar-denominated debt remain most vulnerable in the shorter term, but investors remain positive on the long-term growth story of the group,” Mishra said.


Company: cnbc, Activity: cnbc, Date: 2018-09-05  Authors: eric rosenbaum, chris mcgrath, getty images news, getty images, james leynse, corbis historical, roger wright, brendan mcdermid, michael nagle, bloomberg
Keywords: news, cnbc, companies, investors, panic, remain, sell, funds, etf, emerging, em, scariest, assets, emb, retail, markets, individual


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Emerging-market pain is seen lasting into next year, as Argentina and Turkey lead currency crisis

“The longer the Fed takes easing away, the more they’re tightening, the more trouble for emerging markets, and we haven’t seen the worst of it.” Argentina and Turkey have some unique circumstances not shared by other emerging markets. “Their dependence on foreign capital flows is much higher,” said William Jackson, chief emerging markets economist at Capital Economics. Argentina’s problems are bad, but they have been made worse because of investors’ aversion this year to emerging markets. J.P. M


“The longer the Fed takes easing away, the more they’re tightening, the more trouble for emerging markets, and we haven’t seen the worst of it.” Argentina and Turkey have some unique circumstances not shared by other emerging markets. “Their dependence on foreign capital flows is much higher,” said William Jackson, chief emerging markets economist at Capital Economics. Argentina’s problems are bad, but they have been made worse because of investors’ aversion this year to emerging markets. J.P. M
Emerging-market pain is seen lasting into next year, as Argentina and Turkey lead currency crisis Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2018-08-31  Authors: patti domm, erica canepa, bloomberg, getty images
Keywords: news, cnbc, companies, lasting, pain, lead, trade, argentina, markets, slowing, currency, seen, rates, turkey, large, em, jackson, emerging, crisis, emergingmarket


Emerging-market pain is seen lasting into next year, as Argentina and Turkey lead currency crisis

As Argentina’s currency plungedand interest rates spiked this week, the South American country was at the epicenter of an emerging-markets financial spiral that is expected to continue well into next year.

Argentina’s peso steadied Friday after losing about 20 percent against the dollar since Tuesday as its central bank said it would auction dollar reserves. On Thursday, the country’s central bank jacked up interest rates to 60 percent from 45 percent.

The International Monetary Fund on Friday said it supports Argentina and that it would meet with officials Tuesday on a revised economic plan, after the country requested accelerated payments from a $50 billion credit line.

The emerging markets have been hurt by U.S. Federal Reserve rate hikes, which have driven up the value of the dollar versus other currencies, making it more expensive to repay dollar-denominated debt. Trade wars have also been a factor, and they hurt commodity prices. Commodities are important revenue sources in emerging markets.

As Argentina’s currency suffered, other emerging markets’ currencies fell in sympathy this past week, including Turkey’s lira, which has been under pressure recently as its central bank has refused to hike interest rates. The lira was recovering some losses Friday.

“This is not over by any means,” said National Alliance’s Andrew Brenner. “The longer the Fed takes easing away, the more they’re tightening, the more trouble for emerging markets, and we haven’t seen the worst of it.”

Argentina and Turkey have some unique circumstances not shared by other emerging markets.

“Their dependence on foreign capital flows is much higher,” said William Jackson, chief emerging markets economist at Capital Economics. “They also have large foreign currency debt.”

Argentina’s inflation rate is now more than 30 percent, and Turkey is expected to release new inflation data next week, which Jackson said could show a pace of 20 percent.

But while Turkey has resisted taking the steps strategists see as necessary, like raising interest rates, Argentina has tried to restore confidence, but so far its difficulties are recurring.

“Part of it is that their economic vulnerability is really large. They’ve had a recession every two years for the past six years. The IMF deal is the 23rd since the 1950s,” said Jackson. “They have a quite weak domestic base, a large reliance on imports.”

Capital Economics says the Argentine peso may have stabilized for now, and the focus is on the government’s press conference on Monday, when it is expected to discuss its economic plan. Argentina’s problems are bad, but they have been made worse because of investors’ aversion this year to emerging markets.

“We’re in an environment where everyone is negative on EM. Argentina got caught wrong-footed at a bad time for EM,” said Win Thin, senior currency strategist at Brown Brothers Harriman.

Thin said the weakness is not likely to abate across the emerging markets any time soon. “U.S. rates rising, trade tensions, China slowing — for me that’s a negative backdrop for EM,” he said. The widely held iShares MSCI Emerging Markets ETF temporarily crossed into bear market territory in August, dropping 20 percent from its January high. The ETF was down more than 4 percent in August and about 1 percent this past week.

J.P. Morgan economists said the pain in Argentina and Turkey is not yet indicative of a broader emerging markets contagion.

“The forecast continues to assume that the spillover from these countries to the rest of the EM will be fairly limited,” wrote the J.P. Morgan economists. “Nonetheless, financial conditions have tightened in the remainder of the EM this year and it is hard to know whether this is fully incorporated in our forecast for this group.”

Strategists said trade tensions have been one big factor hitting emerging markets, starting with China. The Trump administration has put tariffs on steel and aluminum globally and on $50 billion of Chinese goods. The president is expected to consider tariffs on another $200 billion in Chinese goods in September.

China’s U.S. ambassador, Cui Tiankai, said China will not give in to intimidation. “This has to be a process of goodwill for goodwill and good faith for good faith. If we can reach an agreement through this approach, I don’t think the current economic and trade issues would be that difficult,” he said on Thursday.

China, meanwhile, has been easing up on policy to encourage more bank lending and growth.

“China’s economy is still slowing. Commodities prices are not favorable, and we do see as we go towards next year, as the Fed tightening starts to filter through, you’re going to get a slowdown in the U.S,” said Jackson. “Turkey and Argentina are going into recession. We see slowing growth in most parts of the emerging world over the next couple quarters, large parts of Latin America, Eastern Europe and China. There are stronger forecasts than most for Russia, Mexico and Brazil. It might be a cyclical recovery in the economy even if their markets do badly.”

Capital Economics says growth is slowing into the third quarter after GDP in the emerging markets grew by about 4.6 percent in the second quarter, up from 4.5 percent in the first quarter. Stronger growth in Asia offset a slowdown in Latin America.

Jackson said Brazil may be one of the economies with a brighter outlook, but it suffers from serious political risk. Currently, a large part of its population favors jailed former president Luiz Inácio Lula da Silva in the next election while no other candidate has more than 20 percent support. “There’s a lot of uncertainty about the elections in October,” he said. “The field is wide open.”


Company: cnbc, Activity: cnbc, Date: 2018-08-31  Authors: patti domm, erica canepa, bloomberg, getty images
Keywords: news, cnbc, companies, lasting, pain, lead, trade, argentina, markets, slowing, currency, seen, rates, turkey, large, em, jackson, emerging, crisis, emergingmarket


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Global markets continue the bull-run, but have they forgotten Turkey?

Economic stress in Turkey is usually the first warning signal for an abrupt shift in risk tolerance for global markets. Another beacon of market stress is Dr Copper, as it too has flashed warning signals about ailments in the global economy. For instance, take the bipolar view on emerging markets (EM) – that anti-emerging market sentiment had risen to peak levels, and that was before the Turkey crisis hit. Diana Amoa, fixed income portfolio manager at J.P. Morgan Asset Management, is also optimi


Economic stress in Turkey is usually the first warning signal for an abrupt shift in risk tolerance for global markets. Another beacon of market stress is Dr Copper, as it too has flashed warning signals about ailments in the global economy. For instance, take the bipolar view on emerging markets (EM) – that anti-emerging market sentiment had risen to peak levels, and that was before the Turkey crisis hit. Diana Amoa, fixed income portfolio manager at J.P. Morgan Asset Management, is also optimi
Global markets continue the bull-run, but have they forgotten Turkey? Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2018-08-27  Authors: karen tso, bulent kilic, afp, getty images
Keywords: news, cnbc, companies, investors, forgotten, bullrun, crisis, turkey, risk, trade, em, market, global, warning, continue, markets


Global markets continue the bull-run, but have they forgotten Turkey?

Economic stress in Turkey is usually the first warning signal for an abrupt shift in risk tolerance for global markets.

The fear is that despite alarm around the Turkey crisis being dialed back, and U.S. markets continuing to stretch out the bull market, a full-blown market event could still be brewing, just like in the past when Turkey headwinds worked their way up into a storm for developed markets several months later.

Another beacon of market stress is Dr Copper, as it too has flashed warning signals about ailments in the global economy.

The two red lights have caused some investors to pause for thought, while others have taken pre-emptive action and de-risked portfolios finding safety in cash with U.S. Treasury yields close to 3 percent.

Markets have been uncomfortable this year for hedge funds, fund managers, retail investors… only a handful appear to be enjoying the ride. Uncertainty is elevated, even if it’s not reflected in the the CBOE Volatility Index (VIX), the so-called fear gauge.

For instance, take the bipolar view on emerging markets (EM) – that anti-emerging market sentiment had risen to peak levels, and that was before the Turkey crisis hit. Yet others see the positioning as merely a buyer’s guide, a sign that EM is well and truly ripe for a short squeeze.

Bank of America Merrill Lynch Global Research told CNBC this week that EM should lead any bounce in risk assets. Diana Amoa, fixed income portfolio manager at J.P. Morgan Asset Management, is also optimistic, encouraged by the performance of EM bonds during the height of the Turkey crisis. She told CNBC recently that sentiment in EM bonds was not as bad as in 2015 when everyone just wanted to get out. What could spur risk on? The obvious catalyst is any breakthrough in the trade war between the U.S. and China.

So the question remains: are the recent signals from Turkey and copper showing a false positive?

The underlying reason why EM has struggled this year is due to the retreat by the U.S. Federal Reserve from extraordinary monetary policy, lifting the dollar and U.S. yields. It has also made markets more sensitive to noise such as the political wrangling from the White House on trade and everything else.

It’s hard to see the Fed cooling its heels near-term as it keeps a keen eye on inflation and attempts to bank some ammunition for the next crisis. Any relief rally on a trade resolution may be short-lived and it’s the same for developed markets. Technical analysts are calling a short-term pop in stock prices on Wall Street, but struggle to see how longer-term gains can hold.

Consensus is growing that the end is near for the bull market, that 2019 or 2020 will bring an end to the economic expansion that means we are in the last heady times of market ascent. But, remember market timing is often a weak area for investors, hence the common advice, don’t try and time the markets.

So is Turkey telling us the party is over? The chances are high that it will have again served as an early warning signal for investors.


Company: cnbc, Activity: cnbc, Date: 2018-08-27  Authors: karen tso, bulent kilic, afp, getty images
Keywords: news, cnbc, companies, investors, forgotten, bullrun, crisis, turkey, risk, trade, em, market, global, warning, continue, markets


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Traders have started to love emerging markets again. But is it really time to buy?

Negative sentiment has been abundant around emerging market (EM) assets over the last four months. Julian Howard, head of multi-asset solutions at GAM, forecast a massive opportunity in emerging markets during a recent appearance on CNBC. It’s almost as though we can see the top of the hill, and that should bring relief to emerging markets.” Howard also reminded investors of the rationale for buying emerging markets — future growth is going to come from China and Asia. “We have been long and wro


Negative sentiment has been abundant around emerging market (EM) assets over the last four months. Julian Howard, head of multi-asset solutions at GAM, forecast a massive opportunity in emerging markets during a recent appearance on CNBC. It’s almost as though we can see the top of the hill, and that should bring relief to emerging markets.” Howard also reminded investors of the rationale for buying emerging markets — future growth is going to come from China and Asia. “We have been long and wro
Traders have started to love emerging markets again. But is it really time to buy? Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2018-08-07  Authors: karen tso, michael nagle, bloomberg, getty images, brendan mcdermid, charles crowell
Keywords: news, cnbc, companies, started, emerging, traders, trade, weve, strong, market, dollar, em, investors, really, love, buy, world, markets


Traders have started to love emerging markets again. But is it really time to buy?

When fear and loathing is at its greatest, then it’s time to buy, or so the theory goes.

Negative sentiment has been abundant around emerging market (EM) assets over the last four months. Investors who flooded into riskier higher growth plays to chase higher returns in a low volatility, low interest rate world, fled the market darling in the face of a stronger dollar, hikes from the U.S. Federal Reserve and trade tensions.

But is the worst almost over? The fund outflows from the Institute of International Finance (IIF) last week offered a glimmer of hope, and contrarians think we’ve hit maximum selling.

Julian Howard, head of multi-asset solutions at GAM, forecast a massive opportunity in emerging markets during a recent appearance on CNBC.

“We may be at the peak of the anti-EM trade, we’ve had a very strong dollar, rising interest rates, but that’s almost getting priced,” he said. “The strong dollar is reflecting that the U.S. economy is doing well, we know the U.S. economy is not going to beat 4.1 percent in 2019. It’s almost as though we can see the top of the hill, and that should bring relief to emerging markets.”

Howard also reminded investors of the rationale for buying emerging markets — future growth is going to come from China and Asia.

“You don’t even need to get that cute about it, emerging markets as a whole is trading at a 30 percent discount to the MSCI World index. So it’s a matter of being in it to capture the upside and if we are peak dollar, and there are strong arguments for that, then emerging markets should start to pay off,” he said.

Emerging market specialists are also sympathetic to the idea that the EM storm is abating.

Louis Costa, head of CEEMEA FX and rates strategy at Citi, told CNBC that emerging market funds have built up cash balances, but that perhaps most of the outflows have now happened.

He also pointed out that much of the selling was in liquid instruments such as exchange-traded funds (ETFs) and that he would be more concerned if the selling had been at an institutional level.

But Costa cautioned investors to remain selective. “The policy of buy everything that walks has gone”, he said.

Others are nursing EM wounds and warn a return is premature.

“We have been long and wrong in emerging markets this year, although we are not changing our allocation,” said Richard Champion, deputy chief investment officer at Canaccord Genuity Wealth Management. “Let’s get the midterms out of the way to see if the trade talk is just politicking.”

Study the EM tide closely if you’ve looking to catch the wave.

Karen Tso is an anchor on “Squawk Box Europe,” CNBC and you can follow her on Twitter @cnbckaren .


Company: cnbc, Activity: cnbc, Date: 2018-08-07  Authors: karen tso, michael nagle, bloomberg, getty images, brendan mcdermid, charles crowell
Keywords: news, cnbc, companies, started, emerging, traders, trade, weve, strong, market, dollar, em, investors, really, love, buy, world, markets


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EM is going to rally or Nasdaq is going to sell off, says Quadratic CIO who warned tech bubble risk

EM is going to rally or Nasdaq is going to sell off, says Quadratic CIO who warned tech bubble risk12:21 PM ET Tue, 31 July 2018Nancy Davis, Quadratic Capital CIO, the woman who warned the tech bubble was at risk joins the ‘Fast Money Halftime Report’ team to discuss her take on the market, emerging markets and diversification.


EM is going to rally or Nasdaq is going to sell off, says Quadratic CIO who warned tech bubble risk12:21 PM ET Tue, 31 July 2018Nancy Davis, Quadratic Capital CIO, the woman who warned the tech bubble was at risk joins the ‘Fast Money Halftime Report’ team to discuss her take on the market, emerging markets and diversification.
EM is going to rally or Nasdaq is going to sell off, says Quadratic CIO who warned tech bubble risk Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2018-07-31
Keywords: news, cnbc, companies, sell, rally, risk, bubble, team, woman, going, quadratic, tech, warned, nasdaq, risk1221, em, cio


EM is going to rally or Nasdaq is going to sell off, says Quadratic CIO who warned tech bubble risk

EM is going to rally or Nasdaq is going to sell off, says Quadratic CIO who warned tech bubble risk

12:21 PM ET Tue, 31 July 2018

Nancy Davis, Quadratic Capital CIO, the woman who warned the tech bubble was at risk joins the ‘Fast Money Halftime Report’ team to discuss her take on the market, emerging markets and diversification.


Company: cnbc, Activity: cnbc, Date: 2018-07-31
Keywords: news, cnbc, companies, sell, rally, risk, bubble, team, woman, going, quadratic, tech, warned, nasdaq, risk1221, em, cio


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Kick ’em while they’re down: Tariffs hit food, beverage companies

American food and beverage companies were already struggling before Canada and the European Union levied steep tariffs in recent weeks on everything from whiskey to ketchup. Canadian tariffs on $12.6 billion in U.S. goods took effect Sunday, a little more than a week after the EU implemented its own. The new duties are retaliatory moves to the Trump administration’s June 1 tariffs on imported steel and aluminum products. Campbell’s CFO, Anthony DiSilvestro, in May called out the expected squeeze


American food and beverage companies were already struggling before Canada and the European Union levied steep tariffs in recent weeks on everything from whiskey to ketchup. Canadian tariffs on $12.6 billion in U.S. goods took effect Sunday, a little more than a week after the EU implemented its own. The new duties are retaliatory moves to the Trump administration’s June 1 tariffs on imported steel and aluminum products. Campbell’s CFO, Anthony DiSilvestro, in May called out the expected squeeze
Kick ’em while they’re down: Tariffs hit food, beverage companies Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2018-07-02  Authors: amelia lucas, getty images
Keywords: news, cnbc, companies, tariffs, companies, companys, company, hit, impact, theyre, earnings, products, em, costs, food, peanut, beverage, fiscal, kick, campbell


Kick 'em while they're down: Tariffs hit food, beverage companies

American food and beverage companies were already struggling before Canada and the European Union levied steep tariffs in recent weeks on everything from whiskey to ketchup.

Canadian tariffs on $12.6 billion in U.S. goods took effect Sunday, a little more than a week after the EU implemented its own. Mexico has announced that it will increase its current tariffs on cheese and pork, effective Thursday. The new duties are retaliatory moves to the Trump administration’s June 1 tariffs on imported steel and aluminum products. China will also implement its own tariffs against the U.S. this Friday.

The tariffs put additional pressure on manufacturers in an industry that already has thin profit margins and is juggling rising costs for raw materials, increased fuel and transportation expenses and price-sensitive consumers who are resistant to paying more without meaningful wage growth.

“The problem right now is while we’re seeing inflationary impact in the goods, in currency changes and because of tariffs, there’s not much inflationary pass-through that you can do in pricing,” former Heinz CEO Bill Johnson said Tuesday on “Squawk on the Street.”

Canada’s levy on soups is expected to hit Campbell Soup particularly hard.

“With a 10 percent tariff on soups and broths and tomato products — representing the core of Campbell’s products that are sold in Canada and made from both U.S. and Canadian ingredients — Campbell estimates the economic impact to our Canadian business to be significant,” company spokesperson Alexandra Sockett said in an email to CNBC. “We are evaluating ways to offset the potential tariff impact and working closely with our customers.”

The new taxes on food products follow on the Trump administration’s tariffs on imported steel and aluminum, 25 percent and 10 percent, respectively, which are also expected to squeeze the company’s profits. The tin plate steel used to make Campbell Soup cans accounts for the New Jersey-based company’s largest outlay for materials.

Campbell’s CFO, Anthony DiSilvestro, in May called out the expected squeeze from tariffs as having a likely impact on the company’s earnings for its fiscal year beginning July 30.

“At this stage, given what we know about accelerating cost inflation in part due to the anticipated impact of import tariffs and the continuing headwind on transportation and logistics cost, we expect our margins will be down in fiscal 2019,” DiSilvestro said at the time.

That pressure comes as Campbell is already grappling with rising transport and logistics costs, For its 2018 fiscal year, which ends July 29, it expects earnings to drop by roughly 5 percent.

Although peanut butter was originally on Canada’s list, the country spared the sandwich spread. But the EU’s import tax on about $3.4 billion in U.S. goods took effect June 22 and included a 25 percent levy on peanut butter. While the product is not nearly as popular in Europe as in the U.S., the penalty represents a symbolic strike against the U.S.

J.M. Smucker, the parent company to the most popular American peanut butter brand Jif, had already hit a rough patch earlier this year.

The company’s shares fell to their lowest point since October 2014 after it reported weak earnings for the fiscal fourth quarter on June 7. Canada’s announcement that peanut butter and jellies could potentially be taxed placed additional pressure on the company. In the end, Canada decided to tax only strawberry jam.

Smucker missed Wall Street estimates by 25 cents a share as consumer food sales slid 2 percent during the three months ended April 30. Higher transportation and other costs also led the company to raise the prices of several products, including its trademark Jif peanut butter.

“Our teams are actively assessing the potential impact to our business and continue to monitor the fluidity of the tariffs issue,” said Smucker spokeswoman Maribeth Burns. “Our products are primarily distributed in North America, so we have minor export business to Europe.”

For PepsiCo — which owns Tropicana, the largest American orange juice brand — a Canadian tariff of 10 percent on orange juice comes as Americans’ taste for its eponymous soda is waning.

CEO Indra Nooyi told analysts in a first-quarter earnings call that the North American beverages division is working through “some challenges.” Those challenges include the decline in soda sales and rising operational costs across the sector.

PepsiCo did not return a request for comment.

Correction: This story has been corrected to reflect that Campbell CFO Anthony DiSilvestro did not blame the drop in the company’s earnings this fiscal year on the anticipated impact of new tariffs.


Company: cnbc, Activity: cnbc, Date: 2018-07-02  Authors: amelia lucas, getty images
Keywords: news, cnbc, companies, tariffs, companies, companys, company, hit, impact, theyre, earnings, products, em, costs, food, peanut, beverage, fiscal, kick, campbell


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