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Real Time Insight

While the U.S. market has been a bit sluggish over the past week, trading has been brutal in many emerging markets. Several nations have seen their benchmarks fall by more than 10% in the past five days, pushing a number of developing nations into crash territory.

 

Country ETF

5 Day Performance

India- (EPI - ETF report)

-12.9%

Indonesia- (EIDO - ETF report)

-20.4%

Philippines- (EPHE - ETF report)

-9.1%

Thailand- (THD - ETF report)

-11.1%

Turkey- (TUR - ETF report)

-11.2%

The reasons for these slumps are pretty varied, though all of the countries have arguably been impacted by taper talk in the U.S. market. This is making many investors reconsider emerging markets in general, but especially some of the nations that have soared in years past and are still relatively high beta markets.

Furthermore, you can see that the epicenter of the crisis is in the Indonesian market, though a number of other Asian nations are also being impacted by this risk-off trade. Sluggish currency trading is also at play in this group, as many of the countries are seeing their currencies trade at multi-year lows against the dollar, further dulling their appeal for U.S.-based investors.

What Happens Next?

Given the quick pace of this crash, do you think this trend can continue and that more pain is ahead for these emerging markets?

Or is now the time to get in on these nations for a discount?

Let us know in the comments section below!

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