EM Rout Result of Worsening Sentiment, Says Goldman Sachs' Barrs

The video discusses the current sentiment in emerging markets (EM), highlighting that the decline in market performance is more sentiment-driven than due to fundamental changes. It explores the impact of a strong dollar and Fed policies on EM equities, noting that historically, EM equities have performed well in normalizing rate environments. The discussion also covers the influence of rising oil prices on EM countries, particularly those with state-owned enterprises, and the challenges faced by minority shareholders. Finally, it outlines investment strategies focusing on governance and growth opportunities in EM.

What is the primary reason for the 8% decline in emerging markets according to the speaker?

• A significant drop in corporate earnings

• A material change in market fundamentals

• A shift in market sentiment

• An increase in trade protectionism

How have EM equities typically performed in a normalizing rate environment?

• They have remained stable

• They have outperformed

• They have underperformed

• They have shown no consistent pattern

What is the main challenge for EM equity investors in a strong dollar environment?

• Higher dividend payouts

• Decreased local currency returns

• Lower interest rates

• Increased local currency returns

How has the composition of EM equities changed since 2008 in terms of oil dependency?

• It has become more oil-dependent

• It has become less oil-dependent

• It has remained the same

• It has become more dependent on other commodities

What is a significant challenge for equity investors in oil-importing EM countries?

• High dividend payouts

• Government interventions in oil pricing

• Lack of corporate governance

• Stable currency exchange rates

What is the expected range for oil prices according to the speaker?

• $80 to $100

• $100 to $120

• $40 to $60

• $60 to $80

How does the US oil price environment differ from the global market?

• It is more volatile

• It is less affected by global trends

• It is more stable

• It is more affected by global trends