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Emerging Market ETFs Bounce on Government Shutdown

By  +Follow October 4, 2013 10:53AM
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Emerging market ETFs were boosted Thursday as the shutdown of the American government entered its fourth day. While political turmoil usually sends investors fleeing from emerging markets, the belief that the shutdown and pending debt-ceiling fight will keep the Federal Reserve’s bond-buying program intact and at current levels appears to have dissuaded fears and helped boost stocks in Indonesia, the Philippines, and India.

Today’s gains stretched across the board for various emerging market ETFs. The iShares MSCI Emerging Markets Indx (EEM) gained over 1 percent, the Vanguard FTSE Emerging Markets ETF (VWO) was up just over 1.15 percent, the WisdomTree India Earnings Fund ($EPI) gained over 1.5 percent, the PowerShares India Portfolio ($PIN) rose just over 1.5 percent, iShares MSCI Malaysia Index Fund (EWM) leapt almost 2.5 percent, and the iShares MSCI Indonesia Investable Market Index Fund (EIDO) was up just under 2.5 percent.

Emerging Markets Bolstered by Government Uncertainty

While it runs counter to traditional thinking about emerging market equities, the turmoil in Washington appears to be boosting funds tracking these stocks. It’s something that played out last month when currencies in emerging markets plunged on speculation that the Fed would taper the bond buying program, strengthening the dollar and drying up available capital. Now, with the bond-buying program continuing, many see an increased appetite for risk that will push investors into emerging market stocks with the chance for higher yields.

The Financial Times quoted a Societe Generale ($SCGLY) note to its clients as saying: “To the extent that it may affect Fed policy expectations this [the shutdown] may actually feed through as a risk-on signal for global emerging markets (GEM). In addition, this may lead to a downgrade of U.S. macro data in terms of market significance, which helps support the bottom-up approach to GEM while undermining the U.S.-centric top-down theme.”

Emerging Markets Coming Off Strong September

The news that the predicted taper in quantitative easing would be delayed at least a month combined with news of better-than-expected recoveries for economies in Europe, Japan, and the United States made for a rosy September for emerging market ETFs. Since September 1, the iShares MSCI Emerging Markets Indx is up almost 10.5 percent.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.


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Results for EEM
Seeking Alpha
22 Aug 14 04:44:56
Great Graphic: Relative Performance Real And Anticipated http://t.co/VdKlmV2XoN $SPY $EEM $IEV
ETF alpha
22 Aug 14 04:41:54
$NGE vs $EEM Ratio hoovering just above a firm support level of 0.3404 >> #Nigeria #Africa http://t.co/FJxJNkAX1c
iHangout
22 Aug 14 03:02:41
http://t.co/Vv1sYDyeQn Stock_Tracker: Stock DD Board: Emrg Mkts Index MSCI Ishares (EEM) 44.87 $EEM http://t.co/VrJ4BBhcsp
Rosner Stocks
22 Aug 14 00:36:36
$AKRX Summary http://t.co/4W4Sih26Dh Also See: $CSX $EEM $DAL $USO ~
Investors Hangout
21 Aug 14 23:46:30
$AC/B.TO Prev Close http://t.co/doH1h4F5ny Also See: $FOLD $AEO $JRJC $EEM ~
Sophie Tam
21 Aug 14 23:36:19
RT @SeekingAlpha: Are U.S. Stocks More Attractive Than Emerging Markets? http://t.co/U9BtpurbXW $EEM $SPY $VTI $XLK
Market Updates
21 Aug 14 20:16:07
$EEM: Midday index, ETF option volumes http://t.co/4gtzEoLcYB http://t.co/hiO4tcCv2A
Investors Hangout
21 Aug 14 19:51:11
$USLV % Change http://t.co/jLLuHel8VH Also See: $VALE $XLY $EEM $LVS ~
Kaneco
21 Aug 14 19:15:57
If $EEM sells tom we could get a weekly hammer. http://t.co/ppFPG9tvcc
Chasing Stars
21 Aug 14 19:13:39
$TZA 52Wk High http://t.co/d3xe5cTwxP Also See: $BRCM $EEM $CSX $LOCO ~
Rosner Stocks
21 Aug 14 19:03:15
$TQNT Open http://t.co/tx0nMgm1mL Also See: $BNK.TO $TQNT $EEM $TEDU ~
awolam
21 Aug 14 16:35:00
RT @SeekingAlpha: Are U.S. Stocks More Attractive Than Emerging Markets? http://t.co/U9BtpurbXW $EEM $SPY $VTI $XLK
Kyle Schulz
21 Aug 14 16:33:28
RT @SeekingAlpha: Are U.S. Stocks More Attractive Than Emerging Markets? http://t.co/U9BtpurbXW $EEM $SPY $VTI $XLK
Seeking Alpha
21 Aug 14 16:32:47
Are U.S. Stocks More Attractive Than Emerging Markets? http://t.co/U9BtpurbXW $EEM $SPY $VTI $XLK
Stephen Weitzel CFP®
21 Aug 14 16:30:44
@timseymour @allstarcharts thoughts on action in $FXI $EEM $XME
Business News Now
21 Aug 14 16:16:06
$EEM: Are U.S. stocks more attractive than emerging markets? http://t.co/iMmktkaRfH http://t.co/8VjK8GLJ5y
TalkMarkets
21 Aug 14 16:09:05
Are U.S. Stocks More Attractive Than Emerging Markets? $SPX $EEM http://t.co/XjMcx6WQP9
Colin Macleod
21 Aug 14 16:01:10
August 21 2014 P&F Triple Top Breakout http://t.co/wH5CVA27SK $EEM $C $IRF $BBD $CX $NEM $IYR $CELG $GGP $JKS $HOLX $URBN
Action Jackson
21 Aug 14 15:41:56
@CNBCAsia #Argentina $eem $bma $bfr $ggal $pam $apsa $teo $pze RT "Judge: Argentina cannot change debt's domicile http://t.co/kZVZENoTqS "
Jeff Quiggle
21 Aug 14 15:23:23
$MACRO > $QQQ $TLT $FXI $SPY $EEM $JNK $IWM $GLD $FEZ $USO Yesterday > $FXI $QQQ $TLT $EEM $SPY $JNK $IWM $GLD $FEZ $USO
Investors Hangout
21 Aug 14 15:20:46
$QLD Ideas http://t.co/mml0NkF7Iy Also See: $CHL $EOG $BBY $EEM ~
ETF Trends
21 Aug 14 15:20:18
Another Frontier #ETF Makes Its Presence Felt http://t.co/nyH5SKTvNn #frontiermarkets #emergingmarkets #ETFs $FM $EEM $EMFM $BBRC
Tom Lydon
21 Aug 14 15:15:19
Another Frontier #ETF Makes Its Presence Felt http://t.co/5WlHJdNPqS #frontiermarkets #emergingmarkets #ETFs $FM $EEM $EMFM $BBRC
ShortStockVolume.com
21 Aug 14 14:31:24
Top Shorted Stocks 08/21/14... 20. $RFMD 62.96% 21. $SPLS 62.88% 22. $VALE 62.77% 23. $EEM 62.73% 24. $SCHW 62.42% 25. $ITUB 62.26%
ShortStockVolume.com
21 Aug 14 14:31:21
Top Shorted Stocks 08/21/14... 23. $EEM 62.73% 24. $SCHW 62.42%... http://t.co/ybJg7nzxOn
Market News Desk
21 Aug 14 14:16:06
$EEM: Following Food Ban, Russia Moving On From Europe http://t.co/hCmYekeFLc http://t.co/Pa95kewA6T
Greg Harmon, CMT
21 Aug 14 13:36:07
$EEM continues pullback from resistance at 45 w/ 48 higher, support 44/43/42.54 http://t.co/Ni5ev7e9c4
Investors Hangout
21 Aug 14 13:28:29
$NKY Prev Close http://t.co/QOrRQHNq06 Also See: $EEM $SMH $EBAY $DUST ~
Top ETF Funds
21 Aug 14 13:18:37
[video] Investors getting risky.. http://t.co/h8WPU3ydTb $EEM #ETF #ETFs #Stocks
Syed Waqas Nabi
21 Aug 14 12:00:11
A bearish Wave the Flag (Bearish) has occurred at 2:30 PM Aug 21 at $44.90 on iShares MSCI Emerging Markets ETF (EEM) $EEM
Syed Waqas Nabi
21 Aug 14 12:00:05
A bearish Wave the Flag (Bearish) has occurred at 2:30 PM Aug 21 at $44.90 on iShares MSCI Emerging Markets ETF (EEM) $EEM
Investors Hangout
21 Aug 14 11:33:23
$LUV P/E Ratio http://t.co/5gaRDPUqzx Also See: $EFA $NUE $EEM $BTE.TO ~
Market Updates
21 Aug 14 11:16:07
$EEM: Is It Time to Buy the iShares MSCI Emerging Markets ETF (EEM)? http://t.co/WfgLHgyM6b http://t.co/RnBxMafbYt
Joe
21 Aug 14 11:07:58
RT @needgoodcharts: $EEM opportunities abound, not to mention this ST patter projects to $47+ http://t.co/nsMD7Ja85p
Market Headlines
21 Aug 14 10:16:11
$EEM: 5 Fastest Growing ETFs Of 2014 By Flows http://t.co/9RYXh37ceR http://t.co/4Lg86nCeZE
BlockTradeAlert
21 Aug 14 10:15:05
BLOCK TRADE: $EEM 581,608 shares @ $44.96 [13:15:04]
BlockTradeAlert
21 Aug 14 10:14:49
BLOCK TRADE: $EEM 541,092 shares @ $44.96 [13:14:49]
charts not opinions
21 Aug 14 09:52:57
$EEM opportunities abound, not to mention this ST patter projects to $47+ http://t.co/nsMD7Ja85p
Investors Hangout
21 Aug 14 08:16:36
jim50: $EEM Open Date=Aug-21-2014 Open=44.97 High=44.98 http://t.co/lZTq3XNUhb
Investors Hangout
21 Aug 14 08:16:24
jim50: $EEM Open Date=Aug-21-2014 Open=44.97 High=44.98 http://t.co/yTz8BCwYaT
Business Headlines
21 Aug 14 08:16:12
$EEM: With U.S. Volatility On The Upswing, Take A Look At Asia [iShares MSCI ... http://t.co/D6wxkpFONP http://t.co/K1S7eTVEgi
Investors Hangout
21 Aug 14 08:11:42
danrocks: $XLU Alert $FUEL $EEM $BRCM $EFA $GDXJ http://t.co/Q8aNTXjNfh
Investors Hangout
21 Aug 14 08:11:17
danrocks: $XLU Alert $FUEL $EEM $BRCM $EFA $GDXJ http://t.co/6mg9FPpGiH
BlockTradeAlert
21 Aug 14 08:08:58
BLOCK TRADE: $EEM 1,200,000 shares @ $44.93 [11:08:58]
danrocks
21 Aug 14 08:03:06
$XLU Alert $FUEL $EEM $BRCM $EFA $GDXJ http://t.co/qcUf7m9PA2
Top ETF Funds
21 Aug 14 08:00:29
Another Frontier ETF Makes Its Presence Felt.. http://t.co/2V1U0Ti2dU $EEM #ETF #ETFs #Stocks
Top ETF Funds
21 Aug 14 08:00:14
Africa Investors Selling Bonds, Despite Growth Prospects.. http://t.co/fbSV8aVrs3 $EEM #ETF #ETFs #Stocks
ETF alpha
21 Aug 14 07:59:43
World’s Biggest Wealth Fund Slows Emerging Market Investment http://t.co/sPW0J3lBuY $EEM $VWO #EM @ETFGodfather @EM_Equity @EricBalchunas
MarketCurrents
21 Aug 14 07:52:34
Norway's SWF slows move into emerging markets http://t.co/buxmQFqLg5 $EEM $VWO $EDC $EDZ
jim50
21 Aug 14 07:44:53
$EEM Open Date=Aug-21-2014 Open=44.97 High=44.98 Low=44.92 Close=44.96 Volume=3347050 http://t.co/YKve1d6Sa0
				
				
By  +Follow October 4, 2013 10:53AM
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