Oil surge rattles EMs
Oil jumped past $100/barrel and Wall Street opened lower, triggering risk-off moves that hit emerging markets hard. (timesofindia.indiatimes.com) Investors are demanding higher returns for EM exposure — India’s Sensex fell ~2.25% and Nifty ~2.09% on March 26, and a new global-risk map flags many emerging markets as high-risk. ( ) That pressure is pushing flows into safe havens and re-pricing ETFs: gold is under close watch and analysts point to the trade-offs between higher-return EM ETFs like EEM and lower-cost, broader options such as SCHE. ( )
Brent crude traded around $103.9 a barrel and U.S. WTI near $91.8 on March 26 as fresh Iran-related disruptions to Gulf flows and Strait of Hormuz risks pushed prices higher. (financialexpress.com) The S&P 500 closed at 6,477.16 (-1.74%), the Nasdaq Composite at 21,408.08 (-2.38%) and the Dow at 45,960.11 (down 469.38 points) on March 26 amid the oil-driven risk‑off, a slide Reuters and CNBC linked to renewed doubts over a ceasefire. (cnbc.com) India’s benchmarks reopened the next session and closed sharply lower on March 27, with the Sensex at 73,583.22 (down 1,690.25 points) and the Nifty at 22,819.60 (down 486.85 points), with PSU banks and auto stocks among the heaviest drags. (business-standard.com) A new Visual Capitalist map, using Damodaran’s equity risk premiums, ranks Belarus, Lebanon, Sudan and Venezuela at the top of global risk (30.9% ERP) and shows only 19 countries with premiums below 5%, underscoring why investors are repricing EM exposure. (visualcapitalist.com) ETF flows reflected that repricing: the iShares EEM registered roughly $1.0–$1.2 billion of outflows in recent sessions, while EEM’s expense ratio sits at about 0.72% with AUM near $26–29 billion. (content.etfaction.com) By contrast, Schwab’s SCHE charges roughly 0.07% and had about $11–12 billion in assets under management, making it a noticeably cheaper broad EM option as investors weigh cost versus past higher returns from funds like EEM. (schwabassetmanagement.com) Gold retreated to the mid‑$4,400s per ounce on March 26 after recent volatility, even as the U.S. 10‑year Treasury yield climbed to roughly 4.38% and the dollar index pushed around the 100 mark—moves that together intensified safe‑haven flows and EM pressure. (fortune.com)
