S&P: emerging markets turned against developed tide in July

According to S&P’s every emerging market index out-performed each developed market index in July.


The poorest performing emerging market index was Hungary, at -7.59%, contributing to emerging markets losing 0.72% overall compared to developed markets being down -1.84%.

The best performing emerging markets were Thailand (12.10%), Peru (10.89%), Philippines (7.64%) and Indonesia (+6.98%); the best performing developed markets were New Zealand (4.42%), Singapore (3.99%) and Japan (3.63%).

The worst performing developed markets were Finland (-10.08%), Italy (-9.43%), Spain (-8.06%) and France (-7.75%).

S&P senior index analyst Howard Silverblatt explained that the US debt crisis “took hold of markets” in the last week of July, turning a global gain of 1.29% into a loss of 1.7%.

“While the US debt problem is a major issue, it is still considered political to some extent, whereas for European countries the debt issues are a matter of financial survivorship,” he added.

In terms of global markets, July reversed the year-to-date trend with emerging markets doing better than developed markets. So far in 2011, emerging markets are off 2.93% while developed markets are up 2.34%.

Summary of other year-end positions:

  • Ten-year Treasury finished July down by 37 basis points to 2.8%, from year-end 2010 close of 3.29%;
  • 30-year Treasury decreased 25 bps to 4.14% from 4.34%;
  • The euro closed at 1.4381 from 1.3363;
  • The pound closed at 1.6425 from 1.5593;
  • The yen closed at 0.0130 from 0.01232.

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