On September 6, 2018, the MSCI Emerging Markets (EM) Index — which tracks stocks in 24 of the world’s
largest developing economies — dropped 20% below its January high, a level of decline that is commonly
considered a bear market.1 Hong Kong’s Hang Seng Index reached the same negative milestone a few
days later. China’s benchmark Shanghai Composite entered bear territory in June.2
In the meantime, the U.S. bull market continued its charge, with major indexes setting new highs despite
escalating trade tensions.3
What’s behind the big declines in emerging markets? And how might the stalking bear in these economies
affect U.S. investors?
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Your Guide to Financial Independence
Rick Epple, CFP(r), CeFT (r)