Emerging-market investors have been pouring money into bonds and cutting back on stocks in a trend that’s set to intensify as the delta variant of the coronavirus ravages developing economies with low vaccination rates.

Bonds have seen net inflows for 11 straight months, the longest streak in Institute of International Finance data going back to early 2018. They surged to a net $99.2 billion in the six months through June, versus net equity withdrawals of $2.2 billion, according the data, which tallies emerging markets excluding China.

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Equities haven’t attracted more money than bonds since November, when vaccine progress and Joe Biden’s election as U.S. president boosted optimism toward the global economy.

The picture won’t change anytime soon because delta-variant risk to emerging markets hasn’t been fully priced in yet, said Paul Sandhu, head of multi-asset solutions at BNP Paribas Asset Management Asia Ltd. The money manager favors the long end of the curve in high-yield emerging markets such as Russia, Colombia and Turkey.

Pictet Asset Management’s Arun Sai also said he favors emerging-market bonds over stocks. Emerging-markets equities only attract sustained inflows when they offer a superior outlook to developed markets, according to Sai, who is a senior multi-asset strategist in London.

An MSCI Inc. gauge of emerging-market equities is down almost 9% from this year’s mid-February peak, while a JPMorgan Chase & Co. index of their dollar bonds is up 5% from a low touched in early March. A measure of local-currency emerging-market government debt has gained about 2.7% from a late March trough. Stocks fell for a third day on Tuesday, while the extra premium on emerging market debt narrowed three basis points.

“Bonds remain key portfolio diversifiers for many investors, and emerging-market debt provided very attractive yields,” said BNP’s Sandhu, who is based in Hong Kong. “Conversely, equity inflows were highly concentrated toward the U.S. markets, rather than emerging markets.”

—With assistance from Selcuk Gokoluk.

This article was provided by Bloomberg News.