Emerging-market stocks erase all their 2021's gains as china slumps

Emerging-market stocks, once the barometer for optimism on global growth, have given up a 12 per cent advance since February

China’s stock selloff has caused emerging-market equities to erase all their gains for the year.

The MSCI Emerging Markets Index — which has more than a third of its weighting in China — wiped out what was left of its 2021 advance after sliding 2.4 per cent on Monday. Strategists are divided on the outlook. State Street Global Markets prefer developed markets as they are ahead in vaccination rates, while AllianceBernstein says EM assets will be supported by a recovery in risk appetite.

“We’re more bullish on DM versus EM,” said Daniel Gerard, a senior multi asset strategist at State Street Global