Throughout July, many sell-side analysts saw the ‘stability’ in EM assets as a sign that the worst was over and urged investors to pile back in to take advantage of ‘blood on the streets’ in EM at these cheap levels.
But, as one veteran EM trader in Brazil exclaimed to us this morning “this is a fucking bloodbath,” adding that “liquidity has disappeared” and as spooked retail investors pile out of ETFs (that their advisers said were no brainers), the pressure in real markets is explosive.
Emerging Market FX is indeed a bloodbath…
While Turkey’s Lira is the biggest loser on the week (and day), no matter where you look, it’s carnage…
The moves are massive but dwarved by Lira…
How much longer can “they” support Emerging Market stocks? Debt and FX have already got the message…
And how long before US stocks catch down to the global stress?
For now Globally Systemic Banks are seeing risk pressures once again…
Offshore yuan is starting to crack again…
And EURUSD has broken the 1.15 shoulder…
via RSS https://ift.tt/2KHmNft Tyler Durden