Emerging markets have been in the doldrums recently but one region, which had been hard hit by the eurozone crisis, seems to be getting ready for a brisk upturn now.
Emerging markets currencies will be one of the most affected asset classes when the Federal Reserve starts to hike interest rates, but actually some of them stand to benefit.
Emerging market assets, particularly bonds but also equities, are staging a comeback as investors gradually return to risky assets.
A survey of investor sentiment carried out by Societe Generale in February among 41 hedge funds and 41 real money investors such as pension funds, showed the bullish bias towards emerging markets strengthening for the near term.
The European Central Bank had no choice but to launch its own quantitative easing programme in the end. The jury is still out on whether it will work – but judging by the first reactions, it could actually mark the return to some sort of normality for the eurozone.
You have to squint to notice it, but it looks like things are finally on the mend in Central and Eastern Europe on the financial front.
Emerging Europe equities could be a good investment for the last quarter of 2014 for those who are ready to brave the huge risks involved. At least that’s the opinion of analysts and asset managers who are looking at the area.
There has been a marked change in sentiment towards emerging markets this year, with more investors getting back in after disappointing performance last year.
But three analysts published warnings about the asset class on Monday. While not calling for an abrupt end to the rises in emerging markets stocks and bonds witnessed over the past few months, the warnings serve as a reminder that volatility can come back at any time.