Far East Investment Management (Hong Kong) Limited’s Post

November 2024 Outlook & Update The Emerging and Frontier credit space proved remarkably resilient in November with the AHGY and EMHY Asia regional and global ETF credit ETFs respectively +0.60% and +0.56%. The VWO Emerging and Frontier equity ETF meanwhile returned -4.67% as US post-election protectionist fears rocked the risky asset space.  Credit-intensive positioning did take a disproportionate hit as investors retreated from riskier corners the emerging and frontier space. A worst-case outcome at an Indonesian garment manufacturer flagged in last month’s update weighed on returns. Duration-heavy positioning took an added hit from the lengthening of the US Fed’s expected rate cut glide path. The stellar performance of Sri Lankan sovereign positions offset these impacts. The announcement of better-than-expected debt exchange terms and a quick Moodys upgrade to Caa1 triggered the move.   The lengthening of US rate cut expectations saw several execute duration-shortening trades in November. The short-dated sovereign-guaranteed inaugural issue by Mongolia’s capital city proved a popular choice. Moodys’ November upgrade also put seasoned issues out of the Central Asian country into vogue. We see improving sovereign creditworthiness underpinning emerging and frontier credit markets in 2025. November saw Moodys upgrade Cyprus in addition to Sri Lanka and Mongolia. S&P upgraded Turkey’s rating with Moodys guiding similar upside in 2025. Fitch meanwhile assigned Nepal a first-time rating while upgrading both Argentina and Egypt in November. www.feimhk.com #FrontierMarkets #EmergingMarkets #CreditMarkets #Indonesia #SriLanka #Cyprus #Mongolia #Turkey #Nepal #CreditRating #Moodys #StandardandPoors #Fitch

November 2024 Outlook & Update The Emerging and Frontier credit space proved remarkably resilient in November with the AHGY and EMHY Asia regional and global ETF credit ETFs respectively +0.60% and +0.56%. The VWO Emerging and Frontier equity ETF meanwhile returned -4.67% as US post-election protectionist fears rocked the risky asset space. Credit-intensive positioning did take a disproportionate hit as investors retreated from riskier corners the emerging and frontier space. A worst-case outcome at an Indonesian garment manufacturer flagged in last month’s update weighed on returns. Duration-heavy positioning took an added hit from the lengthening of the US Fed’s expected rate cut glide path. The stellar performance of Sri Lankan sovereign positions offset these impacts. The announcement of better-than-expected debt exchange terms and a quick Moodys upgrade to Caa1 triggered the move. The lengthening of US rate cut expectations saw several execute duration-shortening trades in November. The short-dated sovereign-guaranteed inaugural issue by Mongolia’s capital city proved a popular choice. Moodys’ November upgrade also put seasoned issues out of the Central Asian country into vogue. We see improving sovereign creditworthiness underpinning emerging and frontier credit markets in 2025. November saw Moodys upgrade Cyprus in addition to Sri Lanka and Mongolia. S&P upgraded Turkey’s rating with Moodys guiding similar upside in 2025. Fitch meanwhile assigned Nepal a first-time rating while upgrading both Argentina and Egypt in November. www.feimhk.com #FrontierMarkets #EmergingMarkets #CreditMarkets #Indonesia #SriLanka #Cyprus #Mongolia #Turkey #Nepal #CreditRating #Moodys #StandardandPoors #Fitch

Emerging Markets government bonds performed very well year to date and the outlook for the next few months is positive. Ihab Salib, Head of International Fixed Income, Federated Hermes Limited, looks at the factors behind the outlook. https://lnkd.in/ghbrRbsT #emergingmarkets #fixedincome #argentina #governmentbonds

Global rating agency Fitch Ratings has said that rapid credit growth and historical risk-taking have intensified asset quality pressures in emerging markets like India and Vietnam. Abhijit Lele reports. #assets #credit https://mybs.in/2dbEFoM

Kelley Global alum Neeraj Seth, Chief Investment Officer & Head of Asian Credit at BlackRock, says “It’s a golden age of fixed income in Asia, specifically the emerging Asian markets,” Blackrock intends to use any volatility in September to buy bonds in Asian countries such as the Philippines & Indonesia in a bet that potential rate cuts by the FED & local central banks will bolster the region’s debt. Southeast Asia is seen to be a beneficiary of so-called friend-shoring – a term used to refer to the preference of doing business with political allies. The region is looking increasingly attractive as an alternative to China as investors are wary of trade frictions between the United States and the world’s 2nd-largest economy in the run-up to the Nov. US Presidential Election.

India’s sovereign bonds to enter Emerging Market Index of FTSE Russell by 2025 #FixedIncome #DebtMarket #SovereignBonds #Borrowing #SovereignDebt #FTSERussell #EMGBI #IndexInclusion #EmergingMarket #Bonds #NCDs #Debentures #Tbills #TreasuryBills #Gsec #Gilt #GovernmentSecurities #India #LKPSecurities https://lnkd.in/djjvBbiS