Emerging-market traders are taking the once-bitten, twice-shy approach with Southeast Asia and omicron, dumping shares from the region that was most impacted when the delta variant arrived.
The MSCI AC Asean Index has fallen more than 4% since U.S. Thanksgiving — when omicron first made its presence known in markets — underperforming the 2% decline in Latin American shares and a tiny gain in Eastern European equities. The gauge of Southeast Asian stocks slumped almost 7% in the two months after the delta variant was officially named at the end of May.
Making matters worse for investors, the region is also threatened by concern over slowing growth in China and the prospect that the Federal Reserve will raise interest rates sooner than earlier anticipated. Traders are looking out for data on China’s exports and inflation this week, alongside more information on the spread and potency of the new variant.