Emerging-Market Tech Stocks Upstage FAANGs

September 5, 2017

The influence of technology stocks in today’s emerging market indexes partly reflects the importance of technology companies in the economic growth of Asian countries.

  • Investors have traditionally associated emerging markets with commodities and infrastructure.
  • Today, the MSCI Emerging Markets Index is dominated by the information technology and financial sectors.
  • The influence of technology stocks in today’s emerging-market indexes partly reflects the importance of technology companies in the economic growth of Asian countries.

Twenty years ago, the MSCI Emerging Markets Index was made up of companies from a variety of sectors and countries that were traditionally associated with commodities and infrastructure. As a result, its performance closely tracked the price of oil. This all changed in 2014, when oil prices began to trend sharply lower — and the Index began to more closely follow information technology shares as those companies grew in importance.

Read the full commentary.