NN - Marketexpress: No relief yet in sight for emerging equities

The picture for EM equities remains bleak. Policy stimulus in China has been ineffective in halting the nation’s growth slowdown, which continues to have a negative impact on commodity prices and EM terms of trade. Capital flows to the emerging world are likely to remain negative in the coming quarters or even years as the US Federal Reserve normalises monetary policy and the US dollar carry trade continues to unwind. EM growth momentum remains negative, both from a macroeconomic and a corporate- earnings perspective. There is little reason to expect a recovery as long as growth data keep deteriorating.