Concerns About Asia and Emerging Market Single Country ETFs Remain

by: MyPlanIQ

With the phenomenal growth of the internet, boundaries between countries are not what they were. Anybody can easily invest anywhere across the globe. This gives investors the ability to diversify their portfolios, reducing their risk and enjoying local bull markets.

Worldwide stocks witnessed a rally last week and all the major markets showing an uptick. Please see the trend score table below:

Assets Class





Germany EWG 16.92% 12.2% ^
South Korea EWY 15.76% 16.62% v
South Africa EZA 14.66% 11.15% ^
Switzerland EWL 14.32% 10.01% ^
Belgium EWK 14.03% 8.9% ^
Australia EWA 12.6% 12.44% ^
France EWQ 12.41% 7.31% ^
Italy EWI 12.18% 4.3% ^
Taiwan EWT 11.37% 10.22% ^
Spain EWP 10.74% 3.71% ^
The Netherlands EWN 10.71% 6.29% ^
United Kingdom EWU 10.46% 8.06% ^
Canada EWC 9.2% 10.41% v
Russia RSX 9.13% 9.56% v
Austria EWO 8.97% 8.32% ^
Malaysia EWM 8.61% 7.69% ^
Mexico EWW 8.6% 7.62% ^
Singapore EWS 8.48% 8.63% v
Hong Kong EWH 6.6% 6.43% ^
Brazil EWZ 3.85% 5.42% v
China FXI 3.56% 5.39% v
Japan EWJ 1.91% -1.61% ^
India INP 1.53% 1.72% v

The trend score is defined as the average of 1,4,13,26 and 52 week total returns (including dividend reinvested).

Global Stocks Trend

During the last 18 months we saw strong capital inflows into Asia rather than emerging markets. Locally, within Asia, this stimulated demand and inflation causing, concerns about overheating. We put a cautionary note that capital may move from Asian to developed nations equities as a risk hedge and also the belief that Japan's equities are bargains.
Last week World equities measured by the MSCI All-Country World Index advanced 3.2% percent, extending the previous session's 0.5 percent rise and further recovering from Monday's 1.6 percent loss. Major U.S. Stock indexes soared and the broad based rally in the world stock is widely supported by the commodities rallies in gold and silver.
Australian and China are performing well. Australia being a commodity based economy enjoying the gains in the commodity prices
Most Asian markets are testing there previous highs too. Hong Kong now has another chance at 25,000. If that breaks the bull trend will likely continue for that market and much of Asia. Thailand is still leading the Asian region, trending higher as their currency strengthens.
Overall the up-trend in global stocks continues and, with the upcoming results seasons, there may be more support for this rally. The weakening dollar and rising commodities adds fuel to the fire and supports the continued rally of stocks.
Disclaimer: MyPlanIQ does not have any business relationship with the company or companies mentioned in this article. It does not set up their retirement plans. The performance data of portfolios mentioned above are obtained through historical simulation and are hypothetical.
Disclosure: Author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.