Emerging-Market bonds have edge over stocks on Covid-19 risks

  • 📰 staronline
  • ⏱ Reading Time:
  • 50 sec. here
  • 2 min. at publisher
  • 📊 Quality Score:
  • News: 23%
  • Publisher: 75%

Business News News

Business Business Latest News,Business Business Headlines

KUALA LUMPUR/SINGAPORE: Emerging-market local-currency bonds especially in Asean countries should continue to prove more resilient than their equity counterparts amid the coronavirus outbreak thanks to proactive monetary policy and uncertainty over corporate earnings, according to market participants.

Students returning from China being checked by medical assistants during a health screening at Kolej Tun Ahmad Zaidi 10th College) in University Malaya. Emerging-market local-currency bonds especially in Asean countries should continue to prove more resilient than their equity counterparts amid the Covid-19 outbreak thanks to proactive monetary policy and uncertainty over corporate earnings, according to market participants.

The Bloomberg Barclays EM Local-Currency Government Bond Index has fallen just 0.2% since markets first took fright about the outbreak on Jan. 21, compared with about a 3% drop in the MSCI Emerging Markets Index. While developing-nation exchange-traded-funds have seen outflows, they have been concentrated in stocks, with bond funds seeing much milder withdrawals.

In some emerging markets, investors are flooding into debt as investors look to central banks. Foreign investors have been net buyers of South Korean debt for 21 straight days through Feb. 10, according to data from the Financial Supervisory Service, as bets rise for a rate cut. Still, not every developing country is benefiting -- global funds are selling Indonesian sovereign bonds at the fastest pace in almost a decade.

While equities have historically enjoyed quick recoveries after previous sell-offs, thanks to buy-the-dip investors, there remains a lack of visibility over the virus’ impact on profits.

 

Thank you for your comment. Your comment will be published after being reviewed.
Please try again later.

WHO ! Say that the earliest of vaccine ? only in 18 months time ?

We have summarized this news so that you can read it quickly. If you are interested in the news, you can read the full text here. Read more:

 /  🏆 4. in BUSİNESS

Business Business Latest News, Business Business Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

Covid-19 outbreak might impact Johor's property market - state excoCORONAVIRUS | He says the property sector could be impacted if the situation prolongs for another three to six months.
Source: malaysiakini - 🏆 20. / 51 Read more »

MGCC woos Malaysian industries to enter Germany’s market | Malay MailKUALA LUMPUR, Feb 13 — The Malaysian-German Chamber of Commerce and Industry (MGCC) is currently making efforts to woo Malaysian industries into setting up their business in Germany. General Manager Thomas Brandt said Malaysian companies, especially those involved in the oil and gas, plantation,...
Source: malaymail - 🏆 1. / 86 Read more »

Jet market oracle Tinseth bows out with Boeing at crossroads | Malay MailSINGAPORE, Feb 12 — Years ago, when Randy Tinseth was still running Boeing’s sales account for United Airlines, the plane company’s designers pulled him aside. “They called me in and said we want to show United this interesting product and we can’t tell you about it until we get there,”...
Source: malaymail - 🏆 1. / 86 Read more »

Wet market cleanliness only at 40%, says Zuraida | The Malaysian InsightHousing and local govt minister hopes markets can maintain its cleanliness.
Source: msianinsight - 🏆 8. / 63 Read more »

Asian plane makers struggle to break into crowded market | The Malaysian InsightJapanese, Chinese firms have both seen their flagship projects delayed for years.
Source: msianinsight - 🏆 8. / 63 Read more »