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Emerging Markets

INVESTMENT INSIGHTS  |  October 2016

The Long View: The Changing Face of the Global Consumer

Consumer spending, long a driver of the global economy, is undergoing sweeping change. Whether it’s housing for millennials or health care for baby boomers, a significant shift in the way people spend money is underway in both advanced economies and the developing world.

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No doubt, the world’s markets spent the first half of 2016 on rocky ground. Investors have been confronted with the British vote to leave the European Union (“Brexit”), a “growth scare” in the U.S., the economic deceleration in China, and the introduction of negative interest rates in some markets. Nevertheless, the global economy is expected to remain on a path to growth — albeit very slow growth.

Looking ahead to the second half of 2016, market volatility is likely to remain elevated. What are the longer term implications of the Brexit vote? Can the resilient U.S. economy continue on its growth path? Will Chinese consumption remain healthy as the world’s second-largest economy continues to slow? Potential opportunity will likely arise for disciplined investors who can look past the near-term macroeconomic clouds toward individual companies with bright prospects.

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INVESTMENT INSIGHTS  |  Wed Jun 22 03:11:00 PDT 2016  |  FEATURING Robert H. Neithart

Uncovering Value in Emerging Markets Bonds Amid Political Change and Uneven Growth

Emerging markets bonds have notched big gains in 2016, despite political turmoil and economic setbacks. Though it is difficult to definitively say that the market has turned for the better, portfolio manager Rob Neithart says there are good reasons for investors to feel positive. The yield advantage of emerging markets over developed markets is hard to ignore, and in some cases valuations are as attractive as they’ve been in years.

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INVESTMENT INSIGHTS  |  March 2016  |  FEATURING Stephen Green & Andrew H. Dougherty

China Mired in Slow Growth, Major FX Move Unlikely

As the world’s second-largest economy, China is at an important turning point. China’s leadership has pledged to put the economy on the right track and be less opaque about its currency moves. Economist Stephen Green and China affairs specialist Andrew Dougherty discuss:

  • The outlook for China’s economy and why a soft landing is more likely
  • The case against China pulling the trigger on a big, one-time devaluation of its currency
  • Whether China’s leadership can manage the political and social implications of deep structural reforms
  • Pockets of strength in the Chinese economy during this transition to consumption-led growth 

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MARKET COMMENTARY  | 
March 2016
 |  FEATURING Matt Miller & Andrew H. Dougherty

Expect a Slow-Growth Transition Period for China

China affairs specialist Andrew Dougherty shares his growth outlook for China as it makes the transition from an investment-based economy to a service-based economy.

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INVESTMENT INSIGHTS  | 
January 2016
 |  FEATURING Joanna (Jody) F. Jonsson

China, Volatility and Why This Is Not 2008

Portfolio manager Jody Jonsson discusses the role of China’s decelerating GDP and overvalued currency in the latest market volatility.

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INVESTMENT INSIGHTS  | 
January 2016
 |  FEATURING Kevin G. Clifford & John H. Smet

Fixed-Income Themes for ’16: Inflation, Quality

American Funds portfolio manager John Smet discusses areas of opportunity he sees for fixed-income investors looking ahead into 2016.

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INVESTMENT INSIGHTS  | 
January 2016
 |  FEATURING Kevin G. Clifford , Timothy D. Armour & Robert W. Lovelace

Investment Themes to Watch in 2016

American Funds portfolio managers Tim Armour and Rob Lovelace discuss investment opportunities in the emerging markets, oil and commodities, health care and pharmaceuticals, and the internet.

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INVESTMENT INSIGHTS  | 
January 2016
 |  FEATURING Kevin G. Clifford & Robert W. Lovelace

U.S., China Trade Places as Global Growth Engine

Portfolio manager Rob Lovelace offers his perspective on recovery and growth in China, the U.S., Japan, Europe and the emerging markets.

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MARKET COMMENTARY  |  January 2016

World Markets Review for 2015

Global stocks delivered essentially flat returns as investor enthusiasm for the U.S. economic recovery was offset by concerns over a sharp slowdown in China. Aggressive central bank stimulus measures continued to support markets in Europe and Japan, while the U.S. gradually stepped back from accommodative policies. Emerging markets stocks generally lagged their developed-market counterparts by a wide margin. Mergers-and-acquisitions activity reached a record high, fueled by cheap financing. 

Defensive stocks outpaced economically sensitive sectors. Health care and consumer staples stocks rallied, while energy and materials stocks plummeted amid falling prices for oil and other commodities. At the end of the year, the U.S. Federal Reserve raised interest rates for the first time in nearly a decade, setting the stage for tighter monetary policy in the years ahead. The U.S. dollar rose against the euro and most other currencies.

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MARKET COMMENTARY  |  January 2016

World Markets Review for Fourth Quarter 2015

Global stocks advanced amid surging M&A activity and a strong year-end rally in the technology sector. The Fed raised interest rates for the first time in nearly a decade, but cautioned that future rate increases would depend on the pace of U.S. economic growth. Conversely, central banks in Europe and Japan ramped up stimulus measures in an attempt to jumpstart lackluster economies. U.S. bonds fell and the dollar rose against the euro and the yen.

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MARKET COMMENTARY  |  December 2015

World Markets Review for November 2015

Global stocks produced mixed returns amid investor worries about sluggish economic growth and expectations for higher U.S. interest rates. European equities advanced on the promise of new monetary stimulus measures, however, U.S. stocks were flat and emerging markets retreated. Bonds also declined as Federal Reserve leaders indicated that a rate hike is likely in December. The dollar rose sharply against the euro and the yen.

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MARKET COMMENTARY  |  November 2015

World Markets Review for October 2015

Global stocks rallied as central bank stimulus and rising M&A activity helped offset ongoing concerns about a slowing world economy. Energy and materials stocks led markets higher amid signs of stabilization in commodity markets. Information technology stocks also advanced on better-than-expected earnings from some bellwether companies. Bonds were generally flat, and the U.S. dollar rose against the euro and the yen.

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INVESTMENT INSIGHTS  |  October 2015  |  FEATURING Brad Barrett

Changing Channels: Media’s New Direction

The landscape of media is undergoing a tectonic shift as the way people consume information, entertainment and even communicate with each other has been transformed by innovation and technology.

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INVESTMENT INSIGHTS  |  October 2015  |  FEATURING Timothy D. Armour

Digital Dollars: Ad Money Didn’t Waste Any Time Moving Online

Advertisers have flocked to the Internet and mobile as consumers change behavior

The face of the world’s media market is changing. Advertising dollars are increasingly flowing from traditional ads to digital. Increased spending on mobile, social media and digital video propelled U.S. digital advertising revenue to $49.5 billion for the full year of 2014, a 16% increase over 2013.

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INVESTMENT INSIGHTS  |  October 2015  |  FEATURING Jim S. Kang

Inflection Points Abound as Consumers Embrace New Technology

Streamers, gamers and cord-cutters are part of the landscape, but not point-and-shoot cameras

One need not look too far these days to find an example of how innovation can transform an industry. The charts above show a remarkable array of change, some of which are still evolving. Many gamers now play on mobile devices, not consoles. Most pictures are taken on phones, and most point-and-shoot cameras have been put on the shelf.

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Online and social media rival television as the main source of news in the U.S.

How people consume news has undergone a sea change. More people now get their news from digital sources than they do from either print newspapers or the radio, and digital is starting to make a move on TV as the dominant place people go for news.

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INVESTMENT INSIGHTS  |  October 2015  |  FEATURING Brad Barrett

Going Mobile: The Serious Business of Playing Games

With sales about to exceed $100 billion a year, video games are hardly kid stuff

In 2013, Grand Theft Auto V became the fastest-selling entertainment product of all time, with sales of $1 billion in just three days. That probably disabused most people of the notion that video games were kid stuff.

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INVESTMENT INSIGHTS  |  October 2015  |  FEATURING Andrei Muresianu

Has Streaming Turned Cable TV Into a House of Cards?

Netflix and others have redefined TV, but consumers are reluctant to cut the cord

Netflix can seem like a juggernaut. The company recently reported that it had 65.6 million subscribers at the end of the second quarter of 2015. Of those, 42 million are in the U.S. and another 23 million are international.

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MARKET COMMENTARY  |  October 2015

World Markets Review for Third Quarter 2015

Global stocks tumbled amid increasingly alarming signs of an economic slowdown in China and uncertainty over U.S. monetary policy. Energy and materials stocks plummeted on worries about declining global demand for commodities. Defensive sectors, including consumer staples and utilities, generally held up better than cyclical stocks. Government bonds rallied and the U.S. dollar slipped against the euro and the yen. 

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INVESTMENT INSIGHTS  | 
September 2015
 |  FEATURING Stephen Green

China’s Long-Term Growth Story Still on Track

Economist Stephen Green gives his view on the key drivers of China’s economy over the next ten years.

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INVESTMENT INSIGHTS  | 
September 2015
 |  FEATURING Stephen Green

China’s Near-Term Outlook Remains Challenging

Economist Stephen Green discusses China’s slowing economic growth and government stimulus measures.

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INVESTMENT INSIGHTS  | 
September 2015
 |  FEATURING Stephen Green

China Transitioning to Consumption-Based Economy

Economist Stephen Green examines China’s move to a new growth model along with the challenges of capturing an accurate GDP reading.

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INVESTMENT INSIGHTS  | 
September 2015
 |  FEATURING Stephen Green

Chinese E-commerce on the Rise

Economist Stephen Green sees growth in China’s digital world, from upcoming innovations to a steady increase in mobile phone usage.

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Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so they may lose value.

This material is intended for use by financial professionals or in conjunction with the advice of a financial professional.

Investors should carefully consider investment objectives, risks, charges and expenses. This and other important information is contained in the fund prospectuses and summary prospectuses, which can be obtained from a financial professional and should be read carefully before investing. 

Bond ratings, which typically range from AAA/Aaa (highest) to D (lowest), are assigned by credit rating agencies such as Standard & Poor's, Moody's and/or Fitch, as an indication of an issuer's creditworthiness.

Lower rated bonds are subject to greater fluctuations in value and risk of loss of income and principal than higher rated bonds. 

Investing outside the United States involves risks, such as currency fluctuations, periods of illiquidity and price volatility, as more fully described in the prospectus. These risks may be heightened in connection with investments in developing countries. 

Statements attributed to an individual represent the opinions of that individual as of the date published and do not necessarily reflect the opinions of Capital Group or its affiliates. This information is intended to highlight issues and not to be comprehensive or to provide advice.