Market Briefing: Emerging Markets Stocks, Bonds, & Currencies

Market Briefing: Emerging Markets Stocks, Bonds, & Currencies September 5, 216 Dr. Edward Yardeni 516-972-7683 eyardeni@ Joe Abbott 732-497-536 jabbott@ Mali Quintana 48-664-1333 aquintana@ Please visit our sites at www. blog. thinking outside the box

Table Of Contents Table Of Contents EM MSCI In Dollars & Local Currencies 1 Stock Markets: Americas 2-3 Stock Markets: Asia 4-7 Stock Markets 8-9 US$ Forex Rates: Americas 1 US$ Forex Rates: Asia 11 Fragile Five 12-13 Emerging Markets Bond Yields 14-15 September 5, 216 / Market Briefing: Emerging Markets Stocks, Bonds, & Currencies www.

16 Figure 1. EM MSCI In Dollars & Local Currencies EMERGING MARKETS MSCI STOCK PRICE INDEXES 6 14 5 12 Local Currency 4 1 8 US Dollars 3 6 2 4 1 2 1995 1996 1997 1998 1999 2 21 22 23 24 25 26 27 28 29 21 211 212 213 214 215 216 217 Source: Morgan Stanley Capital International. 2 Figure 2. MSCI EMERGING MARKETS CURRENCY INDEX* (US$) 2 15 15 1 1 5 1999 2 21 22 23 24 25 26 27 28 29 21 211 212 213 214 215 216 217 5 * Includes Brazil, Chile, China, Colombia, Czech Republic, Egypt, Greece, Hungary, India, Indonesia, Korea, Malaysia, Mexico, Peru, Philippines, Poland, Qatar, Russia, South Africa, Taiwan, Thailand, Turkey, and United Arab Emirates. Source: Morgan Stanley Capital International. Page 1 / September 5, 216 / Market Briefing: Emerging Markets Stocks, Bonds, & Currencies www.

Stock Markets: Americas 65 55 Figure 3. EM LATIN AMERICA MSCI (US$) ARGENTINA MSCI 5 4 45 35 25 3 2 15 1 5 5 BRAZIL MSCI CHILE MSCI 3 4 3 2 2 1 1 8 MEXICO MSCI PERU MSCI 2 6 15 4 1 2 5 2-day moving average Source: Morgan Stanley Capital International and Haver Analytics. Page 2 / September 5, 216 / Market Briefing: Emerging Markets Stocks, Bonds, & Currencies www.

Stock Markets: Americas 1 8 6 Figure 4. EM LATIN AMERICA MSCI (local currencies) ARGENTINA MSCI 3 2 4 1 2 3 BRAZIL MSCI CHILE MSCI 7 6 2 5 4 1 3 2 1 5 4 MEXICO MSCI PERU MSCI 4 3 3 2 2 1 1 2-day moving average Source: Morgan Stanley Capital International and Haver Analytics. Page 3 / September 5, 216 / Market Briefing: Emerging Markets Stocks, Bonds, & Currencies www.

Stock Markets: Asia 7 6 Figure 5. EM ASIA MSCI (US$) CHINA MSCI 14 12 5 4 3 1 8 6 4 2 2 1 HONG KONG MSCI 12 SINGAPORE MSCI 1 7 6 8 6 4 5 4 3 2 2 1 6 SOUTH KOREA MSCI 2-day moving average Source: Morgan Stanley Capital International and Haver Analytics. TAIWAN MSCI 35 3 4 25 2 2 15 1 Page 4 / September 5, 216 / Market Briefing: Emerging Markets Stocks, Bonds, & Currencies www.

Stock Markets: Asia 1 8 6 Figure 6. EM ASIA MSCI (local currencies) CHINA MSCI 14 12 1 8 6 4 4 2 2 18 16 HONG KONG MSCI SINGAPORE MSCI 5 14 4 12 1 3 8 2 6 4 1 7 6 SOUTH KOREA MSCI TAIWAN MSCI 4 5 3 4 3 2 2 1 1 2-day moving average Source: Morgan Stanley Capital International and Haver Analytics. Page 5 / September 5, 216 / Market Briefing: Emerging Markets Stocks, Bonds, & Currencies www.

Stock Markets: Asia 12 1 Figure 7. INDONESIA MSCI (US$) THE PHILIPPINES MSCI 7 6 8 5 4 6 3 4 2 2 1 6 MALAYSIA MSCI INDIA MSCI 8 5 6 4 4 3 2 2 1 5 THAILAND MSCI PAKISTAN MSCI 25 4 2 3 15 2 1 1 5 2-day moving average Source: Morgan Stanley Capital International and Haver Analytics. Page 6 / September 5, 216 / Market Briefing: Emerging Markets Stocks, Bonds, & Currencies www.

Stock Markets: Asia 8 Figure 8. INDONESIA MSCI (local currencies) THE PHILIPPINES MSCI 15 6 1 4 5 2 7 MALAYSIA MSCI INDIA MSCI 15 6 5 1 4 3 5 2 1 6 THAILAND MSCI PAKISTAN MSCI 6 5 5 4 4 3 3 2 2 1 1 2-day moving average Source: Morgan Stanley Capital International and Haver Analytics. Page 7 / September 5, 216 / Market Briefing: Emerging Markets Stocks, Bonds, & Currencies www.

Stock Markets 2 15 Figure 9. RUSSIA MSCI (US$) ISRAEL MSCI 4 3 1 2 5 1 2 POLAND MSCI TURKEY MSCI 8 15 6 1 4 5 2 15 HUNGARY MSCI EGYPT MSCI 15 1 1 5 5 11 1 9 8 7 6 5 4 3 2 1 CZECH REPUBLIC MSCI 2-day moving average Source: Morgan Stanley Capital International and Haver Analytics. SOUTH AFRICA MSCI 7 6 5 4 3 2 1 Page 8 / September 5, 216 / Market Briefing: Emerging Markets Stocks, Bonds, & Currencies www.

Stock Markets 2 15 Figure 1. RUSSIA MSCI (local currencies) ISRAEL MSCI 4 3 1 5 2 1 3 POLAND MSCI STOCK PRICE INDEX TURKEY STOCK PRICE INDEX 15 25 2 1 15 5 1 5 25 HUNGARY MSCI EGYPT MSCI 3 2 15 2 1 1 5 7 6 CZECH REPUBLIC MSCI SOUTH AFRICA MSCI 15 5 4 1 3 2 5 1 2-day moving average Source: Morgan Stanley Capital International and Haver Analytics. Page 9 / September 5, 216 / Market Briefing: Emerging Markets Stocks, Bonds, & Currencies www.

US$ Forex Rates: Americas 6 8 1 12 Figure 11. MEXICO (Peso/$) BRAZIL (Real/$).1.6 1.1 1.6 2.1 14 16 18 2 2.6 3.1 3.6 4.1 4.6-5 5 1 15 2 ARGENTINA (Peso/$) CHILE (Peso/$) 3 35 4 45 5 55 6 65 7 75 8 11 1 9 8 7 6 5 4 3 2 1 VENEZUELA (Bolivar Fuerte/$) 8/26 COLOMBIA (Peso/$) 12 16 2 24 28 32 36 2.2 2.4 2.6 PERU (New Sol/$) 2.8 3. 3.2 3.4 3.6 3.8 2-day moving average Source: Morgan Stanley Capital International. Page 1 / September 5, 216 / Market Briefing: Emerging Markets Stocks, Bonds, & Currencies www.

US$ Forex Rates: Asia 5.6 6. 6.4 6.8 Figure 12. CHINA (Yuan/$) 9/2 MALAYSIA (Ringgit/$) 2.5 3. 3.5 7.2 8/26 4. 7.6 8. 4.5 8.4 5. 6 8 SOUTH KOREA (Won/$) INDONESIA (Rupiah/$) 6 8 1 1 12 8/26 12 14 14 16 16 25 35 INDIA (Rupee/$, inverted scale) THAILAND (Baht/$) 25 3 45 55 35 65 4 75 45 2-day moving average Source: Haver Analytics. Page 11 / September 5, 216 / Market Briefing: Emerging Markets Stocks, Bonds, & Currencies www.

5 Figure 13. FOREIGN EXCHANGE RATES: FRAGILE FIVE (percent change) Fragile Five Latest data thru: 9/5/16 5-5 -5-1 Brazil (-6.1) India (-22.) Indonesia (-36.3) South Africa (-69.5) Turkey (-65.1) -1-15 J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D 213 214 215 216 Source: Morgan Stanley Capital International. -15 4 Figure 14. MSCI PRICE INDEXES: FRAGILE FIVE (US$, percent change) Latest data thru: 9/5/16 4 2 2-2 -2-4 -6 Brazil (-38.5) India (14.7) Indonesia (-9.5) South Africa (-18.5) Turkey (-39.9) -4-6 -8 J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D 213 214 215 216 Source: Morgan Stanley Capital International. -8 Page 12 / September 5, 216 / Market Briefing: Emerging Markets Stocks, Bonds, & Currencies www.

5 4 3 2 Figure 15. MSCI PRICE INDEXES: FRAGILE FIVE (local currencies, percent change) Brazil (-1.5) India (4.) Indonesia (23.5) South Africa (38.2) Turkey (-.7) Fragile Five Latest data thru: 9/5/16 5 4 3 2 1 1-1 -1-2 -2-3 -3-4 J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D 213 214 215 216 Source: Morgan Stanley Capital International. -4 Page 13 / September 5, 216 / Market Briefing: Emerging Markets Stocks, Bonds, & Currencies www.

14 12 1 Figure 16. Emerging Markets Bond Yields 1-YEAR GOVERNMENT BOND YIELDS IN EMERGING ECONOMIES (percent) Hong Kong (.97) India (7.12) Malaysia (3.55) Philippines (3.43) 14 12 1 8 8 6 6 4 4 2 26 27 28 29 21 211 212 213 214 215 216 217 2 Source: Haver Analytics. 8 6 Figure 17. 1-YEAR GOVERNMENT BOND YIELDS IN EMERGING ECONOMIES (percent) Singapore (1.74) South Korea (1.51) Taiwan (.69) Thailand (2.34) 8 6 4 4 2 2 26 27 28 29 21 211 212 213 214 215 216 217 Source: Haver Analytics. Page 14 / September 5, 216 / Market Briefing: Emerging Markets Stocks, Bonds, & Currencies www.

16 14 12 1 Figure 18. Emerging Markets Bond Yields 1-YEAR GOVERNMENT BOND YIELDS IN EMERGING ECONOMIES (percent) Brazil (4.27) Chile (4.27) Colombia (7.38) 16 14 12 1 8 8 6 6 4 9/2 4 2 2 26 27 28 29 21 211 212 213 214 215 216 217 Source: Haver Analytics. Page 15 / September 5, 216 / Market Briefing: Emerging Markets Stocks, Bonds, & Currencies www.

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