Insight

Where do we find value in Emerging Market equities in 2024?

Where do we find value in Emerging Market equities in 2024?
Key takeaways
Capital returns have driven Developed Market (DM) performance
1

Emerging Market (EM) equities higher yields were overshadowed by higher capital returns in DM in aggregate between 30 September 2022 and 31 January 2024.

Positive environment ahead for Emerging Markets
2

A weakening US dollar, falling developed market interest rates and a potential rebound in economic growth in the second half of the year could boost returns on EM equities.

Latin America may lead emerging market regions
3

Latin American markets seem to be the most attractive with relative dividend yields higher than historical norms.

The recovery from the global equity bear market of 2022 has been on pause for Emerging Market stock markets since the middle of last year. On paper, the region could find the economic and policy environment of 2024 hospitable, especially if the global economy gets through its current soft patch and developed market central banks start cutting rates. In such a diverse region, we think it is worth digging deeper into which countries we would favour for the long term based on their valuations.

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