Emerging markets can take only so much of a beating - FT.com

Emerging markets can take only so much of a beating - FT.com:



"Here are a few connected facts. Emerging markets have now given back all their outperformance versus developed markets since they became winners on the back of Chinese stimulus in late 2008. Mining stocks in the FTSE World Mining index are back where they stood at their lowest post-Lehman point. And inflation in Brazil just passed 9 per cent for the first time in more than a decade.



Everything connected to commodities, including a large chunk of emerging markets, looks atrocious. Weakness in Chinese demand and a depressed growth outlook have trashed prices of main commodities, hitting miners. Economic and political cracks long covered up by easy profits from commodity production are being revealed as prices crash, with Brazil, Russia and South Africa all suffering.



Investors are responding in the traditional way to a strengthening dollar: they are dumping emerging markets and slashing exposure to commodities."



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