Last week, indices around the globe showed a mixed bag of results – our top funds this year such as South Africa (EZA), Russia (RSX) and South Korea (EWY) continued to do well while Spain (EWP) and China (FXI) posted another lackluster performance.
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Among the emerging markets, Taiwan (EWT)
reversed its recent up trend and fell 1.45% last week. The selloff was
primarily driven by profit taking and concerns over exporters'
profitability from a stronger local currency. At the same time, China's
central bank announced a 25 basis points rate hike over the weekend to
gear up for the fight against inflation. FXI ended last week flat, but the Shanghai Composite has tumbled more than 4% this week.Spain (EWP)
dropped 3.5% last week. Markets are still concerned that the
debt-riddled Spanish government may be forced to seek a bailout and a
new wave of panic would be triggered in the eurozone. There does not
seem to be much clarity on this issue ahead.