Related
The price-ratio of the MSCI EM index — a measure of the performance of developing nation equities in dollar terms to the MSCI World index (for developed nations) — stood at 0.46 on April 3. That’s perilously close to the lower-end of its consolidating range of 0.45-0.9. A breakout below this crucial range could trigger selling by Algo-traders, accentuating the pace of the decline that has caused indices to retreat a third from recent highs.
The price ratio of the MSCI EM index and MSCI world index has been indicating a bearish lower-top and lower-bottom pattern since 2011. This reflects that the pressure on the EM equities would be more than its developed counterparts.
In the past one month, Indian equities underperformed the EM universe by 6%. In that period, the EM index has underperformed the DM index by 160 basis points. Neeraj Agarwal, vice-president at Antique Broking, believes any break-out of consolidating range on either side would result in a further sharp movement of 10% in the direction of the break-out.
Given the uncertainty over Covid-19, the odds appear rather short on a downward journey.
Read More News on
Download The Economic Times News App to get Daily Market Updates & Live Business News.
Subscribe to The Economic Times Prime and read the Economic Times ePaper Online.and Sensex Today.
Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price
Read More News on
Download The Economic Times News App to get Daily Market Updates & Live Business News.
Subscribe to The Economic Times Prime and read the Economic Times ePaper Online.and Sensex Today.
Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price