LONDON, March 31 (Reuters) - Hard-currency corporate and sovereign debt as well as equities were the best performers across emerging markets in the first quarter of 2015, while local debt and currencies continued to suffer.
Offering exposure to both a strengthening dollar and robust emerging market economic growth, hard-currency corporate and sovereign debt chalked up gains of some 2 percent over the first three months of the year.
Meanwhile emerging market stocks, riding the tailwind of a global equity bull market, gained 1.7 percent over the same period after two consecutive quarters in the red, as this graphic shows:
The start to the year has also seen a dramatic turnaround for some emerging and frontier market trouble spots.
Argentina’s MSCI country index has soared by almost 30 percent, making it the star performer of the MSCI Frontier Market country indexes. Kenya and Estonia meanwhile clocked up gains of 6 percent apiece, as this graphic shows:
Eastern Europe produced the best performers across emerging markets’ MSCI country indexes, with Russia rising more than 18 percent and Hungary up more than 17 percent, as this graphic shows:
“Central Europe has benefited from the combination of huge rally in stocks and bonds in western Europe, there has been very strong feed-through,” said UBS strategist Manik Narain.
Meanwhile any exposure to local currency brought about much pain for investors, with JPMorgan’s emerging currency index down some 2 percent since end-December while its GBI EM local currency index fell more than 4 percent.
Most currencies were well into the red against the dollar, which is on track to log its biggest quarterly gain since 2008.
Brazil’s real suffered the steepest losses, easing 22.5 percent against the greenback, while Turkey’s lira was down 11.3 percent. Russia’s rouble was the biggest gainer, up 3.7 percent, as this graphic shows:
link.reuters.com/jas44w (Reporting by Sujata Rao and Karin Strohecker, Graphics by Vincent Flasseur and Christian Inton; Editing by Catherine Evans)