Frontier markets are poised to rise this year as they benefit from lower valuations and a “reasonably solid” economic outlook, according to Andrew Howell, a Citigroup Inc. equity strategist.
- Howell provided the view in a report released Wednesday. Any advance might be well received because these stocks have been through what can be considered a lost decade. The MSCI Frontier Markets Index rose just 9.5 percent from 2009 through 2018.
- During the same period, the MSCI Emerging Markets Index added 70 percent and the MSCI World Index of developed markets climbed 112 percent.
Emerging-market stocks have “restored a lot of value” after eight months of losses, according to Richard Turnill, BlackRock Inc.’s global chief investment strategist. Turnill compared the MSCI Emerging Markets Index’s forward price-earnings ratio, based on profit projections, with the ratio for the MSCI World Index of developed markets in a blog post Friday. Developing countries’ P/E discount widened to 29 percent Friday from this year’s low of 19 percent, set Jan. 26, as their MSCI index dropped 21 percent.
