Emerging Markets See Gains Amid New Iran Proposal to US
Emerging Assets Extend Gains as Iran Delivers New Proposal to US
Mint
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Emerging-market assets, including stocks and currencies, continued to rise as Iran proposed new negotiations with the US through Pakistan, despite ongoing geopolitical tensions. The MSCI Emerging Markets Index increased by 0.2%, while the currency index rose 0.3%, driven by gains in the Hungarian forint and Polish zloty.
- 01The MSCI Emerging Markets Index rose by 0.2%.
- 02The currency index saw a 0.3% increase.
- 03Geopolitical tensions in the Middle East have heightened market volatility.
- 04Earnings estimates for the MSCI index are at a record high.
- 05Analysts predict a 22% gain for the MSCI index by April 2027.
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Emerging-market benchmarks for stocks and currencies extended their gains amid holiday-thinned trading, with the MSCI Emerging Markets Index climbing 0.2%. This rise was bolstered by stocks in the United Arab Emirates, particularly First Abu Dhabi Bank PJSC and ADNOC Drilling Co. The currency index also increased by 0.3%, driven by the Hungarian forint and Polish zloty. Despite the ongoing closure of the Strait of Hormuz and geopolitical tensions, analysts remain optimistic about the medium-term outlook for emerging markets. Cassidy Ainsworth-Grace, a macro strategist at Oxford Economics, noted that while tensions could escalate, the impact on global economic growth is likely to be limited. Earnings estimates for the MSCI index have reached record highs, prompting analysts to upgrade their target for the index, forecasting a 22% gain by April 2027. Additionally, Hungary disclosed details of a €1 billion ($1.2 billion) loan from China, which could influence market dynamics.
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The positive performance of emerging markets could lead to increased investor confidence, potentially benefiting local economies and businesses reliant on foreign investments.
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