Alongside other notable rallies in the last couple of weeks, the emerging markets have roared back since their Covid-19 rout in March. The EEM iShares Emerging Markets ETF has risen 34% since its March 21 nadir, reflecting the bounce-back of a number of markets. And like the stock market rallies elsewhere, it has people asking, is this rational? And if so, is it overdone?

Emerging markets equities lost $31 billion in March amid the virus turmoil. Just $700 million crept back into EM equities in May, according to the Institute of International Finance.

Portfolio managers have recently said that there was a wide disparity in preparedness for a catastrophe for the coronavirus among the emerging market countries, and there were lots of haves and have-nots. China, South Korea and Thailand had good marks for their high health-care capacity, low external debt, and stimulus wiggle room to fight the economic downturn. South Africa, Turkey, Brazil and Mexico were in trouble. These countries either faced huge debt problems or fortunes tied to oil (or both). Currencies were suffering as well. And when money ebbs from emerging markets in times of crisis, it hampers these countries’ abilities to use policy to tend to the woes of their citizens.

Yet the turmoil has also created opportunities in the minds of some emerging markets managers.

“EM equities, as measured by the MSCI EM Index, are trading at valuations in line with their historical averages, yet these valuations appear inexpensive when the index’s changed sector exposure is taken into account,” said Todd McClone, a portfolio manager on the global equity team at William Blair, writing in a May 20 blog post. “The higher-valued information technology, consumer retail, and media sectors were about 10% of the index in 2008, and the lower-valued energy and materials sectors about 40%. Today, the former is about 40%, and the latter roughly 10%.”

McClone said some themes have an advantage in the turmoil, specifically, “technology-enabled growth areas such as 5G telecom, e-commerce and online education.” He especially emphasizes themes in China, which has emerged from the Covid-19 pandemic in better stead than a lot of countries (even though the virus emerged there). China is even expected to have a slightly positive GDP this year, though the country said in reports that it is not setting a target. Chinese GDP in 2019 was 6.1%.

The U.S. GDP, by contrast, could contract by more than 5.6% this year, according to the Congressional Budget Office.

Dave Iben, the chief investment officer and lead portfolio manager at Kopernik Global Investors in Tampa, Fla., said emerging markets are appealing to investors in many cases because there aren’t a lot of other places to go. Cash is likely going to have a negative real return while sovereign bonds around the world “are priced somewhere between negative and 1%."

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