Fears of a US recession are causing investors to look again at emerging markets, according to a new survey that suggests that a majority will increase their exposure to the asset class in the coming months, Bloomberg reports. Some 61% of the 234 investors polled in the latest Markets Live Pulse survey say they’re going to put money into EM over the 12 months despite the potential for a US downturn to weigh on the asset class.

EM could outperform in the face of a US recession: Almost half agreed that cheap valuations and underlying growth of EM assets will help them outperform developed markets should the US fall into recession.

Emerging economies have grown more resilient with time: “Economies in the developing world are far more resilient places today than they were 30 years ago, and EM central banks have been largely more responsible in dealing with the rise in inflation than the developed world has been,” said one fund manager at Invesco.

Where are investors looking? Investors are betting on Southeast Asian markets, expecting them to generate the best returns in comparison to other EMs. “Southeast Asia is one of the best places to be for long-term investors … There’s a track record of sound macro management, better demographics and a steadily rising flow of foreign direct investment,” one strategist told the news outlet.

EGX30

16,861

+0.7% (YTD: +15.5%)

USD (CBE)

Buy 30.84

Sell 30.96

USD at CIB

Buy 30.85

Sell 30.95

Interest rates CBE

18.25% deposit

19.25% lending

Tadawul

11,342

0.0% (YTD: +8.2%)

ADX

9,479

-0.3% (YTD: -7.2%)

DFM

3,545

-0.3% (YTD: +6.3%)

S&P 500

4,192

-0.1% (YTD: +9.2%)

FTSE 100

7,757

+0.2% (YTD: +4.1%)

Euro Stoxx 50

4,395

+0.6% (YTD: +15.9%)

Brent crude

USD 75.58

-0.4%

Natural gas (Nymex)

USD 2.59

-0.3%

Gold

USD 2,000.30

+1.1%

BTC

USD 26,859

-0.6% (YTD: +62.8%)

THE CLOSING BELL-

The EGX30 rose 0.7% at yesterday’s close on turnover of EGP 1.22 bn. Local investors were net buyers. The index is up 15.5% YTD.

In the green: Eastern Company (+6.7%), Ibnsina Pharma (+5.5%) and Cleopatra Hospitals (+5.0%).

In the red: Ezz Steel (-3.6%), Sidi Kerir Petrochemicals (-1.9%) and E-finance (-1.7%).

It’s a mixed start to the week for Asian markets this morning, with stocks in China, Hong Kong and Korea seeing gains but exchanges in Japan and Australia in the red. Shares in the US are on course to fall at the opening bell amid concerns about the debt ceiling negotiations.

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