Bonds, emerging stocks eye ‘geo-investment’ switches

News Snapshot:

August has been rough so far for emerging market stocks and western government bonds, a worrying confluence that may extend losses from ‘geo-investment’ standoffs and reflect an increasingly polarized world economy. Northern summer months can be a dangerous time to over-interpret financial market moves. Thin trading volumes and exaggerated price swings notoriously deliver bum steers during holiday periods. But they can also crystallize brewing problems. The COVID pandemic and Russia’s invasion of Ukraine last year threaten a fragmentation of trade globalization between western democracies and emerging economies, centered on ideas of national security, supply chain risks and economic dominance -...