Equities And Emerging Markets Could Get A Boost From Rate Cuts Says One Analyst

“I think the Fed has clearly been pressured by the White House. It’s been going on for a number of months, and I don’t see it letting up. And also it’s coinciding with a softening of some of the data in the US, some of the more recent PMI numbers are showing that there is a slow down, consistent with what we are seeing elsewhere in the world. I think you’re seeing a shift or drift back to what we’ve seen over the last 2 to 5 years, where interest rates will be lowered whether it be in China Europe or the US, potentially a return to QE, Which means the Goldilocks scenario where bonds can continue to rally will reengage. So I think in terms of where equities are globally, I think the lower interest rates trend the cheaper equity is become. And I think you were going to continue to make new highs, whether it be in the US market or elsewhere. It’s probably very bullish also for emerging markets, because it looks like the bull run in the dollar is starting to fade out, which will be very positive for M debt and equity,” explained Christopher Peel, chief investment officer at Tavistock Investments on CNBC.

For investors looking for the continued upside in emerging market assets, whether driven by a weakening USD or continued developments around trade, the Direxion MSCI Emerging Over Developed Markets ETF (NYSEArca: RWED) offers them the ability to benefit not only from emerging markets potentially performing well, but from emerging markets outperforming developed markets.

Conversely, if investors believe that resolutions to the big issues impacting sentiment today are in motion, the Direxion MSCI Developed Over Emerging Markets ETF (NYSEArca: RWDE) provides a means to not only see developed markets perform well, but a way to access a convergence/catch-up in performance of DM relative to EM, a spread that has clearly widened over the past 6 months.