Iran war and stocks: Why Global X says 'it might be time to double down' on emerging markets
#emerging markets #Iran war #dollar trends #ETF investments #energy markets #geopolitical risk #market volatility #USO
📌 Key Takeaways
- Global X ETF's Malcolm Dorson suggests 'doubling down' on emerging markets despite Iran war risks
- Weaker dollar trends and domestic uncertainty are seen as tailwinds for emerging markets
- The iShares MSCI Emerging Markets ETF is down 5% week-to-date but up 37% over the past year
- Energy sector is highlighted as a key area to watch if Iran conflict prolongs
- USO is identified as a way to play potential energy market volatility
📖 Full Retelling
Global X ETF's Malcolm Dorson and VettaFi's Cinthia Murphy have suggested that investors should consider increasing their exposure to emerging markets despite the risks associated with the ongoing war with Iran. Speaking on CNBC's 'ETF Edge,' Dorson stated that 'it might be time to double down' on emerging markets, pointing to weaker dollar trends and domestic uncertainty as tailwinds for this investment category. The senior portfolio manager expects that anticipated U.S. war spending will eventually soften the greenback, creating a favorable backdrop for emerging markets despite the dollar's recent strength. While acknowledging the dollar's near-term increase, Dorson expressed skepticism that this trend will persist long-term, noting that many people may be underestimating the duration of geopolitical tensions. As of Wednesday's market close, the iShares MSCI Emerging Markets ETF had declined more than 5% for the week but remained up nearly 37% over the past year, suggesting a potential buying opportunity according to Dorson. VettaFi's Cinthia Murphy echoed this sentiment, suggesting that investors have grown accustomed to geopolitical noise and that there are compelling reasons to consider international markets. Murphy identified energy as a key sector to watch if the Iran conflict becomes prolonged, particularly noting European markets' dependence on Middle Eastern energy resources. She highlighted the United States Oil Fund (USO), which had gained 12% so far that week and 32% for the year as of Wednesday's close, as one way to position for potential energy market volatility.
🏷️ Themes
Geopolitical Investing, Market Strategy, Energy Markets
📚 Related People & Topics
United Service Organizations
American charitable organization
The United Service Organizations Inc. (USO) is an American nonprofit-charitable corporation that provides live entertainment, such as comedians, actors and musicians, social facilities, and other programs to members of the United States Armed Forces and their families. Since 1941, it has worked in p...
List of wars involving Iran
This is a list of wars involving the Islamic Republic of Iran and its predecessor states. It is an unfinished historical overview.
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In this article USO EEM Follow your favorite stocks CREATE FREE ACCOUNT watch now VIDEO 12:57 12:57 Energy importers and exporters that could benefit from the war in the Middle East ETF Edge It may be time to dive deeper into the emerging markets trade. Despite risks tied to the war with Iran, Global X ETFs' Malcolm Dorson points to weaker dollar trends and uncertainty at home as a tailwind for the group. "It might be time to double down," the firm's senior portfolio manager told CNBC's " ETF Edge ." He expects a burst of U.S. war spending will soften the greenback, which jumped this week, and create a favorable backdrop for emerging markets. When asked about whether the dollar's near-term strength could stick, Dorson responded, "for sure." However, it's not his base case. "A lot of people are trying to say this is going to be over in a week or two. We're not sure," he said. "However, I do think there are a lot of reasons to take advantage, to buy the dip here [in emerging markets.]" As of Wednesday's market close, the iShares MSCI Emerging Markets ETF is off more than 5% week to date. It's still up almost 37% over the past year. VettaFi's Cinthia Murphy also sees advantages by putting money to work abroad and finds investors have grown accustomed to geopolitical noise. "There is no question that international has been the flavor of the year," the firm's director of research said. Murphy indicates energy is the area to watch if the Iran conflict becomes prolonged. "European markets are super dependent on energy and oil coming out of the Middle East," she said. "So, I think it could really shake things up a lot." Murphy listed the United States Oil Fund as a potential way to play energy. It's up 12% so far this week and up 32% this year, as of Wednesday's close. Disclaimer More In ETF Edge watch now watch now VIDEO 12:57 Energy importers and exporters that could benefit from the war in the Middle East Dominic Chu watch now watch now VIDEO 04:52 Why Latin America coul...
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