Finally GEM outflows now can we rally?

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First outflow in 24 weeks would seem to be the headline but more importantly it should be why didn't the 23 weeks in a row take emerging markets higher?

[caption id="attachment_62393" align="alignright" width="300" caption="Brazil's Bovespa stock exchange in Sao Paulo"] Image courtesy Evandro Miquelito: http://www.flickr.com/photos/emiquelito/ [/caption]

Despite very strong tape this at least tells you why we are not seeing any follow through in emerging markets form yesterday's strong U.S. tape.

Emerging markets ETFs (US-listed) flows went negative with a -1.85Bn outflow, the first of 2013.

Much of this were in Chinese ETFs (40%) but other former darlings like Brazil playing a role as well with  -$540m outflows on country ETFs listed in U.S.

 A quick look at the breakdown of our emerging markets vs. domestic markets chart tells you that emerging markets have been a surprising disaster relative to investing in SPDR S&P 500 ETF ( SPY , quote ) since the highs at the end of 2012.  Emerging markets are oversold but has proven historically that it can always get cheaper.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , International , Stocks

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