Emerging markets India, Turkey, and Brazil have been battered by a spate of domestic setbacks this year. While there are so far not concrete signs that the economy in any of those countries is improving long-term, investors see hope. The tapering of American Federal stimulus, which has begun trickling down to emerging markets, is not expected to occur as quickly as previously thought. Coupled with modest economic developments in those countries, Investors have begun slowly expressing renewed faith in emerging markets
India has seen a fast-devaluing rupee and is in the process of updating their outdated corporate legal system. The installation of Raghuram Rajan as the new central banking chief has renewed confidence in their economy, as the former IMF economist plans sweeping reforms designed to reenergize the slumping BRIC country.
Turkey has been battered since the Turkish Spring, and while the country’s economy is still reeling, and recently downgraded its growth projections even further, from 5 percent on the year to 4. However, investors have rallied behind it as of late, apparently seeing a bottom to the once-hot market’s recent woes.
Brazil was rocked this summer by a series of protests that highlighted the country’s deepening economic divide and frustration at the country’s inadequate infrastructure. The country was buoyed on Sept 9 by economic data out of China that raised the price of their currency the real, sparking investor confidence.
iShares MSCI Turkey Invest Market Index (TUR) , which has been battered this year, rose 5.32 percent to hit $52.27 a share. iShares MSCI India Index (INDA) was up 2.88 percent to hit $22.17 a share. ProShares Ultra MSCI Brazil ($UBR) was the big winner in emerging market ETFs, gaining 6.59 percent to hit $48.85 a share.