MOST EMERGING equity markets are hovering near bear territory after sharp declines since hitting highs in January, and appear set for fresh lows as the simmering US-Sino trade war and rising US yields undermine them.
Twenty out of 23 emerging market stock indexes are trading below their 200-day moving average, a technical analysis showed, suggesting further downside risks to these markets.
China has the worst ratio, with 88% of its companies trading below the 200-day moving average, followed by the Philippines and Poland.
Analysts consider the percentage of stocks trading above or below 200-day moving average as an indicator of strength or weakness of the underlying market.
Another signal that analysts look to confirm a bear market is whether stocks have declined 20% from their year-highs.
Turkey’s 100 share index has fallen about 25% after reaching its year-high in January, while China’s Shanghai Composite index is down 23% from its high.
MSCI’s widely tracked emerging market index has fallen 18% from its January high, based on Monday’s close. — Reuters
