Emerging markets to be the real election winner

InvestorDaily

Earnings growth in developed markets is expected to be outpaced by emerging markets in 2024, an asset manager has said. The electoral calendar for 2024 is shaping up to have a big sway on global emerging markets (EM), according to Lazard Asset Management. With votes taking place in countries that cumulatively account for over a third of EM gross domestic product, Lazard has said this will have important implications for geopolitics, global supply chains, and long-term economic reform.

“Considering the dispersion in monetary and fiscal policies and the heavy election year in 2024, we believe there are ample opportunities for alpha generation,” the firm said. In sovereign credit, countries that Lazard favours include Colombia, Oman, Indonesia, Azerbaijan, Paraguay, and Serbia. “In local debt, we see opportunities in high yielders where real yields remain substantially above potential growth rates while we are generally avoiding duration exposure in Asian low yielders, most notably China and Thailand,” it added.

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