Morgan Stanley Investment Management confidently declared that emerging markets would be the main victor throughout this decade. This is due to their optimistic outlook for developing countries and comparatively low valuations compared to US equities. Jitania Kandhari, Emerging Markets Research Manager at Morgan Stanley’s Investment Management Unit, expressed enthusiasm about India specifically as she believes its growth rate far surpasses America’s potential.
Emerging Aggressive Interest Rates of Central Banks Will End.
According to Kandhari, a new leader takes the market’s reins every decade. This year saw an impressive performance from emerging markets, with the MSCI Emerging Markets Index up 8.6%, while US-based indices rose 4.7%. China abolishing its “Zero Covid” policy and Central Banks’ investor positioning ending aggressive rate hikes had been instrumental in this surge ahead!
What Is the Expectation for the USA?
According to Bank of America’s report, which is based on EPFR Global data, emerging markets are predicted to flourish with a growth rate of 4.1% and 4.4% in 2023 and 2024, respectively – far surpassing the expected 0.5% and 1.2% growth for the USA over those same years. What’s more, developing nations saw record investments from overseas investors; an influx of $12.7 billion poured into their bond stock markets during the week ending January 18th compared to a net outflow of 5.8 billion dollars from US stocks at that time!
Some Countries Benefit from This Situation.
According to Kandhari, India is a standout choice among emerging markets because it has an expanding population compared to China and lower debt. He also noted that other countries, such as Indonesia, Thailand, Vietnam, and Mexico, are capitalizing on China’s ‘deglobalization’ trend. Ultimately, this supply chain division offers promising prospects for these flourishing nations.
