Emerging market stocks rise the most in two months amid China’s pledged to increase private investment in its new economic policy changes.
A nice bounce off the key 5 year levels in the iShares MSCI Emerging Markets ETF (EEM, quote) and Vanguard FTSE Emerging Markets ETF (VWO, quote).
Between the Dr. Yellen reprieve and headlines flowing from Communist Party Summit on market oriented reforms, emerging markets have room to run.
Even if it’s just for a trade there could be no rally in emerging markets without China. Despite horrendous fund flow to date coming out last night from EFPR on emerging markets overall, China fund flows last week were much more resilient than places like Brazil or Korea.
Crowded longs in emerging markets like Mexico were hit the hardest. There is a growing consensus that China (FXI, quote) bottomed in April of this year.
Consumption statistics remain robust and despite the still narrow breadth of the consumer class the affluent Chinese consumer is the target of multinationals everywhere.