Emerging Market Risk Decouples From Global PMI

Emerging markets have traditionally attracted risk-takers, with high volatility and the chance to beat DM returns by a fair margin for investors who manage to time their moves correctly. That’s why PMI (purchasing manager’s index) is normally a good way to tell if it’s time to own Emerging Markets risk, but EM markets have decoupled not only from PMI in the rest of the world but from itself as well.

“Globally, there appears to be no desire to own risk when it comes in the form of Emerging Markets. Even in EM there is no desire to own risk,” write Citi analysts...