Pietari Laurila
United Arab Emirates
2m
ᴡᴇᴇᴋʟʏ ᴜᴘᴅᴀᴛᴇ 8 ᴅᴇᴄᴇᴍʙᴇʀ 2025 Emerging markets have performed strongly this year, with the MSCI Emerging Markets index ($EEM (iShares MSCI Emerging Markets ETF)) up 31%. South Korea is the best-performing country globally, up 85%. Brazil and Mexico are up more than 40%, while China is up 30%. India has underperformed, being unchanged for the year. The 2026 outlook for emerging markets appears promising. Trade tensions have eased, inflation across much of EM has moderated, real interest rates remain high, and many EM central banks are now entering or approaching easing cycles. The prospect of Fed easing resulting in a weaker dollar should also help sentiment. WIthin Emerging Markets, 𝗦𝗼𝘂𝘁𝗵 𝗞𝗼𝗿𝗲𝗮 continues to look attractive despite its strong 2025 performance. The recent reduction in US tariffs, particularly on autos, should help unlock export growth at a time when global trade is stabilising. Korea sits at the heart of semiconductor supply chains while AI-related capex globally is expanding. Domestically, the government's Value-Up initiative continues to push for better shareholder returns, which could help narrow Korea’s persistent valuation discount relative to Taiwan and other developed Asian markets. Despite all these positives, Korea still trades at reasonable multiples. 𝗖𝗵𝗶𝗻𝗮 could be one of the more interesting opportunities in 2026 as policy support becomes more visible and growth stabilises. Analysts expect Beijing to target around 5% GDP growth, underpinned by fiscal stimulus of roughly 1.5% of GDP aimed at boosting consumption and maintaining strong export performance. Politically, the US-China détente lowers geopolitical risk and opens space for renewed capital flows into Chinese assets, while domestic technology leadership – from rare earths to advanced AI – is gaining global recognition. The property sector will likely remain a drag but a fading one, and equity markets may benefit as households rotate out of cash and fixed-income instruments into risk assets. In 𝗜𝗻𝗱𝗶𝗮, valuations are not cheap, but earnings growth expectations into 2026 are solid. India’s economy is growing rapidly supported by rising private investment and ongoing policy efforts to reinforce long-term growth. The Indian market has a low correlation to other markets around the globe, which makes it interesting for investors seeking diversified EM exposure not tied to trade cycles, AI hardware demand or China sentiment. 𝗕𝗿𝗮𝘇𝗶𝗹𝗶𝗮𝗻 equities enter 2026 on the front foot driven by easing monetary policy, strong labour markets and the prospect of stronger domestic demand. Headline inflation has softened, real interest rates remain high, and the central bank is expected to continue cutting rates through 2026. Political uncertainty may cap market optimism until the 2026 presidential election next October, but with equities trading below historical valuation averages and global investors underweight Brazil, improving growth visibility could drive re-rating potential as 2026 progresses. Should my thesis about Europe play out, I will be looking for new opportunities in some of these markets. 𝗣𝗼𝗿𝘁𝗳𝗼𝗹𝗶𝗼 𝗰𝗵𝗮𝗻𝗴𝗲𝘀 None 𝗖𝗼𝗻𝘁𝗮𝗰𝘁 www.triangulacapital.com 𝘛𝘩𝘪𝘴 𝘤𝘰𝘯𝘵𝘦𝘯𝘵 𝘪𝘴 𝘧𝘰𝘳 𝘪𝘯𝘧𝘰𝘳𝘮𝘢𝘵𝘪𝘰𝘯 𝘰𝘯𝘭𝘺. 𝘐𝘵 𝘪𝘴 𝘯𝘰𝘵 𝘢𝘯 𝘰𝘧𝘧𝘦𝘳 𝘰𝘳 𝘳𝘦𝘤𝘰𝘮𝘮𝘦𝘯𝘥𝘢𝘵𝘪𝘰𝘯 𝘵𝘰 𝘣𝘶𝘺, 𝘩𝘰𝘭𝘥 𝘰𝘳 𝘴𝘦𝘭𝘭 𝘢𝘯𝘺 𝘪𝘯𝘷𝘦𝘴𝘵𝘮𝘦𝘯𝘵, 𝘯𝘰𝘳 𝘭𝘦𝘨𝘢𝘭, 𝘵𝘢𝘹, 𝘰𝘳 𝘧𝘪𝘯𝘢𝘯𝘤𝘪𝘢𝘭 𝘢𝘥𝘷𝘪𝘤𝘦. 𝘗𝘢𝘴𝘵 𝘱𝘦𝘳𝘧𝘰𝘳𝘮𝘢𝘯𝘤𝘦 𝘪𝘴 𝘯𝘰𝘵 𝘪𝘯𝘥𝘪𝘤𝘢𝘵𝘪𝘷𝘦 𝘰𝘧 𝘧𝘶𝘵𝘶𝘳𝘦 𝘳𝘦𝘴𝘶𝘭𝘵𝘴.
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