{"text":[[{"start":4.9,"text":"Emerging markets are a time-honoured means for investors in developed economies to diversify their risk. But what if emerging countries are becoming reflections of the tech mania gripping Wall Street? There are certainly signs that similar forces are driving markets in disparate corners of the globe."}],[{"start":22.799999999999997,"text":"MSCI’s emerging markets index this week hit a fresh record. About half of its 17 per cent rally since January has been driven by South Korea’s Samsung Electronics and SK Hynix, up 122 per cent and 146 per cent respectively, and Taiwanese chipmaking giant TSMC with a relatively modest 48 per cent rise. Samsung’s market capitalisation passed $1tn; TSMC’s is almost twice that. "}],[{"start":50.9,"text":"It never takes much though, to make emerging markets lose their investment appeal. Their characteristic volatility can quickly get jittery investors fretting about the sheer range of countries included — does it make sense to lump Brazil in with Poland? — while also griping about their concentration risk, such as China’s heavy weighting. "}],[{"start":70.25,"text":"Emerging markets, in dollar terms, have only beaten the performance of MSCI’s equivalent developed world index five times in the past 15 years, and only two of those were by the sort of margin that would prompt many US investors to reconsider their allocations. Last year the MSCI gained 31 per cent, 12 points more than the developed world."}],[{"start":null,"text":"
"}],[{"start":93.1,"text":"The dollar and technology are the biggest draws right now. A weak greenback is a classic spur for exporters who invoice in dollars and report in their home currency. While the world’s reserve currency has been trading in a tight range rather than falling outright, its inability to rally recently despite the US being an investor haven in turbulent times suggests to a growing army of bears that the next move will be lower. "}],[{"start":116.44999999999999,"text":"That’s an added tailwind for the tech hardware that emerging-market manufacturers dominate, from chips to more critical AI infrastructure such as the servers produced by companies like Taiwan’s Quanta Computer. Other hot trends include electric vehicle batteries, led by China’s CATL and BYD, along with Korea’s LG Energy Solution. Delta Electronics’ combination of power management, data centre cooling, drivetrains, automation and robotics has made it a particular favourite, up 137 per cent this year. "}],[{"start":149.79999999999998,"text":"Despite Asia’s hardware giants trading with a degree of investor excitement not seen for many since the early days of Apple’s iPhone, only Delta and BYD of those mentioned are trading on multiples of estimated earnings above long-term averages, according to S&P Capital IQ, while Samsung and SK Hynix, despite their rallies, are well below on eight and six times compared with 13 and 22 historically."}],[{"start":176.79999999999998,"text":"While emerging markets are generally seen as riskier than their rich-world peers, there’s a case to be made that Asia’s tech manufacturers, supplying picks and shovels of the AI boom rather than its apps and brands, could be on a more durable footing. After all, the key question for makers of AI models or electric-vehicle makers is who wins the battle. For the providers of components and chips, all that matters is that they keep fighting."}],[{"start":211.44999999999996,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1778215594_8097.mp3"}