The recent Emerging Market rally is built off a combination of fundamental and technical factors.
India elections will start on April 7th and last into May 16th. Significant change has been priced into the SENEX (see chart below) into the event. Are investors set up disappointment?
I am starting to get a lot of questions from investors regarding the sustainability of this rally in Emerging Markets and what can be the drivers for the next leg(s) higher.
Recall walking through the ubiquitous chain drug store near you to see the cologne shelves where the knock-off brands advertised “If you like Paco Rabanne, you’ll love ‘Paul Raven’ cologne.” Basically it smells the same but is a lot cheaper.
Brazil, Russia, India and China – collectively the BRIC countries – have under-performed the United States for the past couple of years. An interesting reversal of globalization appears to be developing and it will prove to be quite interesting to witness these four nations as they face a new challenge: how to become a more self-sustaining economy.