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Turkey, China Stocks Drag Down Emerging Markets Again

By  +Follow December 19, 2013 1:28PM
Tickers Mentioned:

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.”

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
Investors Hangout
30 Oct 14 10:15:30
$HGD.TO Day High Click Here: http://t.co/1m8cujscRh Also See: $IBM $GLW $DBA $EEM ~
Boardwalk Securities
30 Oct 14 10:00:40
$Dust #Dslv flying high as $SLV takes faster pace down then $GLD $AGQ suffering also, surprised $EWZ acting well, not sure about other $EEM
30 Oct 14 10:00:31
BLOCK TRADE: $EEM 1,200,000 shares @ $41.88 [13:00:30]
Stock Forums
30 Oct 14 09:49:23
$HYG Bid Click Here: http://t.co/UFeulG8upO Also See: $GRCU $GOOG $PCLN $EEM ~
30 Oct 14 09:47:25
$CDTI Clean Diesel Technologies (CDTI) 2.79 +1.11 (+66.07%) $VMW $EEM $XLK http://t.co/56FYSzm8Dm
30 Oct 14 09:44:39
$CELG Opinion Click here to find out if $CELG is a buy hold or sell. Watching these stocks. $DIS $NEM $EEM $EB http://t.co/TlGky7QYDs
30 Oct 14 09:39:31
$HD Chart Click Here: http://t.co/KWZf0h6vWj Also See: $LVS $EEM $FNV $SLB ~
30 Oct 14 09:36:29
Must-know: Hedge fund positions in emerging markets ETFs http://t.co/bpnHXPoZko $VWO $EEM
Stock Relay
30 Oct 14 09:32:53
$GRCU Tick Click Here: http://t.co/ZjItiHtC91 Also See: $EEM $AMAT $UVXY $ABX ~
30 Oct 14 09:07:16
Implications Of A Stronger U.S. Dollar http://t.co/xdTguTJYmW $USD $SPX $EEM
30 Oct 14 09:00:32
$PG Procter & Gamble Company (PG) 86.75 +0.21 (+0.24%) $EEM $VALE $FSLR http://t.co/rmsSV3bBQC
30 Oct 14 08:48:35
$GDXJ alot of talk going around about this one $UTX $SBUX $TASR $EEM $JNJ http://t.co/EbJO4QNfYS
30 Oct 14 08:46:26
EEM 2.99 Stock Charts $EEM Electricite et Eaux de Madagascar (EPA) Last Updated: 10/30/2014 10:46:34 EEM Stock http://t.co/OsGIsmd6zI
Wanderleia Moreira
30 Oct 14 08:43:51
RT @SeekingAlpha: Volatility In The Emerging Markets http://t.co/2RzyWUspPJ $EEM $VWO $EDC $EDZ $SCHE $IEMG $EEV $ADRE $EUM $EET $GMM $EEME…
Extreme Stocks
30 Oct 14 08:41:11
Stock_Tracker: $EEM Recent News U.S. markets reach firmer http://t.co/zKXUhGhMlj
30 Oct 14 08:39:09
http://t.co/Vv1sYDyeQn Stock_Tracker: Cheeky's Board!: $EEM Recent News U.S. markets reach firmer http://t.co/eZ57czh0wC
30 Oct 14 08:34:08
$EEM Recent News U.S. markets reach firmer technical ground 11:37 a.m. Oct. 21, 2014 - Michael Ashbaugh U.S. m http://t.co/I2inSGiruQ
30 Oct 14 08:17:15
RT @ETFalpha: #China Consumer ETF $CHIQ relative to $EEM #Chart http://t.co/g2TyZDtOJy
30 Oct 14 08:17:02
Global #EM Consumer ETF $ECON vs $EEM performance analysis; country and sector split; top holdings and key statistics http://t.co/ItDkPCurzf
30 Oct 14 08:15:53
RT @ETFalpha: #China Consumer ETF $CHIQ relative to $EEM #Chart http://t.co/g2TyZDtOJy
30 Oct 14 08:15:23
#China Consumer ETF $CHIQ relative to $EEM #Chart http://t.co/g2TyZDtOJy
30 Oct 14 08:14:39
#Thailand ETF $THD vs. $EEM ratio analysis, sector split and top holdings http://t.co/FOQuFDMlfZ
30 Oct 14 08:10:23
Why any concerns about imminent US inflation may be premature http://t.co/5fyvfECTxd $VWO $EEM $EZU $IVV
30 Oct 14 07:59:29
CELG Stock Chart $CELG $EEM $NWBO $MNST http://t.co/zzoBhGZObZ http://t.co/cLf62Aa0Lh
30 Oct 14 07:58:23
PLUG Stock Chart $PLUG $AVP $SNDK $EEM http://t.co/3vUo3KjSy9 http://t.co/XEkcbhRuny
Lach 14
30 Oct 14 07:54:52
@timseymour @GuyAdami @CNBC Sounds a bit like the $EWZ argument, so bad it's bound to bounce? But $EEM very oversold.
30 Oct 14 07:53:25
$ALXN Showing on my streamers $ERUS $AVNR $NFLX $AMBA $EEM http://t.co/mBHidrQY5H
Dimitra DeFotis
30 Oct 14 07:50:47
Emerging Market Must Reads: Russia EU Recon Flights, Mexico Resilience http://t.co/5XXSiFI7ns $SMIN $RUSS $EEM $EWW $TUR #Fed @barronsonline
Investors Hangout
30 Oct 14 07:36:42
clayton: $EEM 41.58 http://t.co/a4Qz7t06Pz
Investors Hangout
30 Oct 14 07:36:39
clayton: $EEM 41.58 http://t.co/tMP0WOQBl2
David Espinosa
30 Oct 14 07:19:33
RT @DeFotis: Brazil Surprise: Central Bank Raises Interest Rate http://t.co/SCXGZqk76p $EWZ $EEM $PBR
30 Oct 14 07:18:21
$EEM 41.58 http://t.co/qfKTApp0Q3
Dimitra DeFotis
30 Oct 14 07:13:21
Brazil Surprise: Central Bank Raises Interest Rate http://t.co/SCXGZqk76p $EWZ $EEM $PBR
Al Sabogal
30 Oct 14 07:09:39
.@timseymour $EEM was a very good r/r ~ 40, long calls $EEM - http://t.co/uY2JRPClVm
30 Oct 14 07:02:27
BLOCK TRADE: $EEM 780,000 shares @ $41.75 [10:02:26]
Rareview Macro
30 Oct 14 06:49:45
China #utilities, the poster child for fixed asset investment, violently breaking out. $FXI $CNY $CNH $EEM $EWZ $RUB http://t.co/pa13tI0o7s
30 Oct 14 06:39:18
$BIDU 200 Simple Moving Average $BIDU Most recent stock chart and technical analysis. $HPQ $EEM $GOOG $LOPE $A http://t.co/7qnakUwzfJ
Al Sabogal
30 Oct 14 06:24:13
Brazil $EWZ strong again. Good for $EEM. Anyone who sold into the Monday 10% puke made a horrific sale.
30 Oct 14 05:45:44
RT @johnkimelman: Exploring Gold Miners, Emerging-Market Stocks http://t.co/VRKMq82RPn $GDX $GLD $EEM
Sheldon McIntyre
30 Oct 14 05:36:15
$SPY : $IEV ratio in all-time highs. End of QE to push the $SPY : $EEM ratio out of a flat base. http://t.co/ZGnPc4rnhN
30 Oct 14 05:25:43
EEM 2.99 Stock Charts $EEM Electricite et Eaux de Madagascar (EPA) Last Updated: 10/30/2014 07:25:50 EEM Stock http://t.co/bBpNlQWzyx
Chasing Stars
30 Oct 14 05:01:55
$FCX Current Price Click Here: http://t.co/PC08gjWjbe Also See: $GMCR $EEM $DBC $SFRX ~
Stephen s
30 Oct 14 04:17:36
RT @rosnerstocks: $EEM 52Wk Low Click Here: http://t.co/sH0tFH2Kye Also See: $CCO.TO $MYEC $RSP $LNG ~
30 Oct 14 03:53:42
Emrg Mkts Index MSCI Ishares (EEM) 41.58 $EEM iShares Launches Beyond BRIC ETF - ETF News And Commentary Zacks http://t.co/zVmci2hOMF
Seeking Alpha
30 Oct 14 03:49:55
Volatility In The Emerging Markets http://t.co/2RzyWUspPJ $EEM $VWO $EDC $EDZ $SCHE $IEMG $EEV $ADRE $EUM $EET $GMM $EEME $DBEM $FEM
Chasing Stars
30 Oct 14 03:26:17
$EEM Ex-Div Date Click Here: http://t.co/hyxnLH8vq3 Also See: $CSX $NLNK $JASO $SWRF ~
Investors Hangout
30 Oct 14 03:11:39
$EEM Bid Size Click Here: http://t.co/LMSRNKfg9W Also See: $MOBL $CCO.TO $XLP $TASR ~
30 Oct 14 03:11:35
$EEM Company Info Click Here: http://t.co/Hlh2bUcxQ5 Also See: $SFRX $MOBL $NM $TNA ~
Stock Relay
30 Oct 14 03:09:55
$EEM Investor Opinions Click Here: http://t.co/oqQqS27JQj Also See: $GMCR $ELTP $BIDU $QLD ~
Rosner Stocks
30 Oct 14 03:05:08
$EEM 52Wk Low Click Here: http://t.co/sH0tFH2Kye Also See: $CCO.TO $MYEC $RSP $LNG ~
By  +Follow December 19, 2013 1:28PM



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