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Turkey, China Stocks Drag Down Emerging Markets Again

By  +Follow December 19, 2013 1:28PM
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The iShares Emerging Markets Index ETF (EEM) dropped over 1.5 percent on Thursday, showing losses the day after the long-awaited announcement of the tapering of quantitative easing.

However, the downward pressure on global stock markets appears to be driven by factors other than concerns of the Federal Reserve’s policy making. In a story similar to that on Tuesday, it appears as though plunging equities markets in Turkey and China are the greater causes of Thursday’s decline.

Fed Tapers Bond-Buying Program

The decision to roll back the rate at which the Fed would purchase bonds by $10 billion a month to $75 billion a month was announced by Ben Bernanke. He also reassured markets that interest rates would stay at or near zero into the future, even beyond the point where unemployment fell below 6.5 percent.

This news about interest rates, paired with general optimism based on a healthy American economy, is generally being cited as one of the primary factors driving the major spike experienced by American stock markets immediately after Bernanke’s announcement. And EEM joined in that rally, spiking 2 percent in less than 10 minutes after the 2 pm announcement and providing further evidence that the taper announcement is most likely not creating a great deal of downward pressure on global markets.

Turkey’s Saga Continues

The corruption probe in Turkey took on a new tenor Wednesday as 10 police commanders leading the investigation were suspended. News out of Turkey now indicates that the corruption saga could be part of a larger political struggle between an Islamist movement led by cleric Fethullah Gulen, who currently resides in Pennsylvania, and forces within the government including Prime Minister Recep Tayyip Erdogan. The movement is believed to have allies in the police and judiciary, prompting the backlash Wednesday by Erdogan.

Regardless of what lies at the source of the political struggle, it continues to hurt Turkish equities. The iShares MSCI Turkey Index ETF (TUR) fell almost 4.5 percent on Thursday, making losses since Tuesday’s dawn raids that led to the arrest of the sons of three cabinet ministers over 8.5 percent.

China Stocks Decline for Eighth Straight Day

Chinese equities continued a losing streak that appears to have the potential to last two straight weeks as major indicies declined for the eighth consecutive day. China ETFs were down accordingly, with the iShares FTSE China 25 Index ETF (FXI) off almost 2 percent and the iShares MSCI China Index Fund (MCHI) declining over 1.75 percent.

Driving the losses are concerns that China’s crackdown on credit markets will hold back economic growth as the cost of funding increases.

“Liquidity is still tight at the end of the year and there’s still downward pressure due to new stock supply in January,” said Zhang Haidong, an analyst at Tebon Securities Co. in Shanghai. “Until we see concrete evidence that the economy is going to be strong again, the market will remain weak.”

Results for EEM
Stock Forums
20 Apr 14 21:55:22
$ELTP Day High Click Here: http://t.co/Sjqvp0JfE4 Also See: $TNA $EEM $AMD $CLF ~
Stock Forums
20 Apr 14 21:47:52
$EEM Bid Click Here: http://t.co/ZFpWZGTdNc Also See: $CHK $AMD $ICBT $PFE ~
$EEM
20 Apr 14 20:33:10
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chartguy89
20 Apr 14 18:48:09
EEM 4.70 Stock Charts $EEM Electricite et Eaux de Madagascar (EPA) EEM Stock Chart - 1 Month http://bigcharts. http://t.co/hcWGWzEyff
Stock Forums
20 Apr 14 17:18:13
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$EEM
20 Apr 14 17:13:39
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$EEM
20 Apr 14 16:23:48
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Rosner Stocks
20 Apr 14 16:09:10
Rosner: EEM iShares Trust $EEM Company Overview Stock http://t.co/eHG2PfjBZ4
Langan Stocks
20 Apr 14 16:09:10
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Johann Garcia
20 Apr 14 14:47:08
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$EEM
20 Apr 14 14:30:06
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$EEM
20 Apr 14 11:43:29
: HAMMER BANG FT $EEM @darealseem #NEW #SHOWLOVE http://t.co/xKxVV6bmfP http://t.co/gFwYUeMjwf @5100Dell ❗️❗️❗$$️
Ben L.
20 Apr 14 11:38:29
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$EEM
20 Apr 14 11:16:37
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$EEM
20 Apr 14 11:07:58
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$EEM
20 Apr 14 11:03:16
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Michael Samhan
20 Apr 14 10:29:50
04-20-14 Trade Plan http://t.co/GNOZgthwkL $SPY $TLT $USO $EEM $RSX $EWZ $XLE $EFA $STUDY
$EEM
20 Apr 14 10:06:19
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$EEM
20 Apr 14 09:51:29
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$EEM
20 Apr 14 09:41:02
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$EEM
20 Apr 14 09:39:28
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Maxx Leatherby
20 Apr 14 09:35:37
$EEM Emerging Markets: The Rally Is Over http://t.co/YAmVCTiBWt
Donte Aldaine
20 Apr 14 09:14:55
$EEM Emerging Markets: The Rally Is Over http://t.co/k7llHiy6eo
$EEM
20 Apr 14 09:11:09
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ALIVE❗️
20 Apr 14 08:42:28
RT @darealseem: HAMMER BANG FT $EEM @darealseem #NEW #SHOWLOVE http://t.co/xKxVV6bmfP http://t.co/gFwYUeMjwf @5100Dell ❗️❗️
$EEM
20 Apr 14 08:42:11
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$EEM
20 Apr 14 08:37:21
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$EEM
20 Apr 14 08:34:25
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$EEM
20 Apr 14 08:32:44
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Market Research
20 Apr 14 08:29:15
$EEM Emerging Markets: The Rally Is http://t.co/2woEUGtPKb
Greg Harmon, CMT
20 Apr 14 07:19:34
What You Liked Most on Dragonfly Capital This Week http://t.co/XmaSg4qADD $NFLX $GLD $SLV $SPY $IWM $QQQ $EEM $FXB
Stock_Tracker
20 Apr 14 06:29:53
Emrg Mkts Index MSCI Ishares (EEM) 42.01 $EEM Knowing ETF Firms' Traits Can Help You Sort Field at Investor's http://t.co/hQUbK3mP5F
Jerome Revillier
20 Apr 14 03:44:56
RT @TraderHMS: Are you feeling stress in your trading? : Trading Card 228 $QQQ $SPY $FB $TWTR $EEM http://t.co/x6JMulLUxd
ActualAdviceMYR
20 Apr 14 03:24:23
RT @TraderHMS: Are you feeling stress in your trading? : Trading Card 228 $QQQ $SPY $FB $TWTR $EEM http://t.co/x6JMulLUxd
Trading Cards
20 Apr 14 03:21:09
Are you feeling stress in your trading? : Trading Card 228 $QQQ $SPY $FB $TWTR $EEM http://t.co/x6JMulLUxd
Lutz Braune
19 Apr 14 22:23:03
$EEM Emerging Markets: The Rally Is Over http://t.co/IvxblsWIrR
Scott Gillespie
19 Apr 14 22:12:05
RT @SeekingAlpha: Emerging Markets: The Rally Is Over http://t.co/szHajfEV46 $SPY $EEM $VWO $EDC $EDZ $SCHE $IEMG $EEV $PIE $ADRE $EUM $EET…
Jim Rosenberg
19 Apr 14 22:09:36
“@SeekingAlpha: Emerging Markets: The Rally Is Over http://t.co/XJoR9iWMH0 $SPY $EEM $SCHE $IEMG $EEV $PIE $ADRE $EUM $EET $GMM $TLO $EEME”
Seeking Alpha
19 Apr 14 22:06:52
Emerging Markets: The Rally Is Over http://t.co/szHajfEV46 $SPY $EEM $VWO $EDC $EDZ $SCHE $IEMG $EEV $PIE $ADRE $EUM $EET $GMM $TLO $EEME
Michael Samhan
19 Apr 14 20:35:38
04-20-14 Trade Plan http://t.co/oyAxPDqi3i $SPY $TLT $USO $EEM $RSX $EWZ $XLE $EFA $STUDY
$EEM
19 Apr 14 19:17:19
"Hammer bang freestyle" #LILDELL ft $EEM 🔥http://t.co/xKxVV6bmfP http://t.co/H3NRXz38cW #T$MG @5100Dell 🔥🔥🔥❗️❗️❗️
Russell Rhoads
19 Apr 14 19:10:55
RT @CBOE: This Week in Emerging Market Volatility – 4/18/2014 http://t.co/dWZkz2sze6 $EEM $EWZ $VXEEM $VXEWZ put up kind of a yawner of a w…
FinanzLinksWORLD
19 Apr 14 19:08:10
RT @CBOE: This Week in Emerging Market Volatility – 4/18/2014 http://t.co/dWZkz2sze6 $EEM $EWZ $VXEEM $VXEWZ put up kind of a yawner of a w…
FinanzLinksUSA
19 Apr 14 18:59:04
RT @CBOE: This Week in Emerging Market Volatility – 4/18/2014 http://t.co/dWZkz2sze6 $EEM $EWZ $VXEEM $VXEWZ put up kind of a yawner of a w…
CBOE
19 Apr 14 18:57:00
This Week in Emerging Market Volatility – 4/18/2014 http://t.co/dWZkz2sze6 $EEM $EWZ $VXEEM $VXEWZ put up kind of a yawner of a week
$EEM
19 Apr 14 18:37:50
"Hammer bang freestyle" #LILDELL ft $EEM 🔥http://t.co/xKxVV6bmfP http://t.co/H3NRXz38cW #T$MG @5100Dell 🔥🔥🔥🔥🔥💯
Kym L
19 Apr 14 17:53:26
RT Apr 15 +small caps have already priced in a recovery and are looking for growth via $EEM. I'm no expert, of course. Just an observation
Eric M. Vihlen
19 Apr 14 17:30:03
CEO Kennedy @ $RTN indicated he will continue to focus on $EEM markets abroad that a "source of considerable long-term growth."
Lutz Braune
19 Apr 14 17:07:04
$EEM Beware the Rush to Emerging Markets http://t.co/GIicQPe3VK
				
				
By  +Follow December 19, 2013 1:28PM
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