Developed markets strengthen, emerging markets struggle – S&P Dow Jones Indices

Howard Silverblatt, senior index analyst, S&P Dow Jones Indices says that developed markets were near their 2007 peak whilst 17 out of 20 emerging markets posted losses in November.

• China does best in emerging markets (4.44%), followed by Mexico (2.92%) and Poland (1.27%). Worst performers are Indonesia (-12.19%), Peru (-9.15%) and Colombia (-8.03%)
• Israel (5.35%), Portugal (4.89%) and Luxembourg (4.54%) lead developed markets. Australia (-5.40%), New Zealand (-3.76%) and Singapore (-2.05%) are bottom of the table
• Diverging fortunes continue as year-to-date emerging down 3.09%, developed up 22.12%

According to the analyst, November continued the wider trend for 2013 as emerging markets (-1.92%) failed to keep up with developed ones (+1.61%) Only three of the 20 emerging markets advanced, compared with gains in 18 of the 26 developed markets.

The US, with 52.6% of the developed market and 47.6% of the global market value, continued to do better than most as it added 2.70% for the month, leaving the developed ex-US component with a 0.42% gain. Overall, developed markets are nearing their peak while emerging markets remain over 22% off than their October 2007 high – struggling with reduced growth expectations as their developed counterparts make progress in economic stability and recovery, Dow Jones Indices’ analyst also highlighted.

European markets continue to rebound
Israel did the best of the developed markets, up 5.35%, followed by Portugal with 4.89% and Luxembourg with 4.54%. Australia did the worst, off 5.40%, followed by New Zealand, off 3.76%. Only Singapore and Australia are down year-to-date, off 1.82% and 0.09% respectively. European markets continued to rebound from recessionary lows, with Greece posting a 2.22% November gain and the best year-to-date gain of 43.84 – though it remains off 23.18% over the three-year period. By contrast, despite a November decline of 1.27% Italy is up 21.86% year-to-date, and 6.87% over the three-year period.

China leads emerging markets, but more than half are in the red year-to-date
Within the emerging markets Indonesia did the worst (-12.19%) followed by Peru, off 9.15%, and Columbia, off 8.03%. China lead the way with a 4.44% gain, followed by Mexico with a 2.92% gain. Though September and October gains of 10.61% have helped, as a group emerging markets remain in the red year-to-date – with 13 of the 20 posting year-to-date declines, Silverblatt concluded.

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