Global asset managers who collectively oversee more than US$20 trillion of assets have grown more bullish across emerging-market equities, currencies, domestic bonds and credit, potentially offering fresh momentum to the sector’s record-busting rally.

Citigroup Inc.

, which reviewed the published outlooks of some of the world’s biggest asset managers, found that funds had added to long positions in markets across Asia, Latin America, as well as Europe, the Middle East and Africa. The findings came as MSCI’s main emerging equity index trades close to record highs. The gauge is up 0.1 per cent on Thursday and almost 15 per cent year to date, helped by tech-heavy bourses in Seoul and Taipei.

Asian tech shares have shrugged off the scare that swept through Wall Street this week, after a report suggested

artificial intelligence

would disrupt swathes of the economy. That’s because Korean and Taiwanese companies produce the hardware used for building AI networks. South Korean stocks added another 3.8 per cent on Thursday, with Samsung Electronics Co Ltd. up nine per cent, for its longest winning streak since 1986.

The South Korean bourse, which recently leapfrogged France to become the ninth largest in size globally, has helped drive the emerging stock index six per cent higher this month alone.

The

S&P 500

, meanwhile, is set to end February flat. U.S. stocks were trading lower on Thursday as Nvidia Corp.’s solid forecast failed to inspire investors seeking reassurances about prospects for artificial intelligence.

The over-arching bullishness on emerging markets is a consequence of increased U.S. policy uncertainty and a blowout fiscal deficit, that’s weighing on the dollar. While that’s forcing more investors to try and diversify exposure away from the greenback, concerns are also mounting over spending increases in Japan, Germany and other developed nations.

Developing nations saw an increase in interest “as managers search for diversification in non-U.S. assets and see opportunities in EM due to improved fundamentals and a weak USD,” Citi analysts told clients.

Cautious session

Emerging-market currencies were weaker on Thursday as the dollar rose about 0.1 per cent. While some Asian currencies posted gains — led by Taiwan’s dollar on the back of strong foreign investment flows — broader sentiment toward developing-world FX turned cautious during the session.

Latin American currencies declined, with the Colombian peso among the worst performers. The currency fell 1.9 per cent after a new poll showed leftist Senator Iván Cepeda holding a wide lead in the presidential race and after Ecuador raised tariffs on imports, escalating a trade dispute. Colombia’s dollar bonds also declined across the curve.

“March 8 elections are right around the corner and local yields are spiking,” said Alvaro Vivanco, EM Macro Strategist at Wells Fargo. While the trend reflected in the poll is not entirely new, he added that approval ratings for incumbent President Gustavo Petro have seen a “big jump” recently, providing a “higher ceiling” for Cepeda at the ballot box.

Other Latin American currencies were also under pressure. The Chilean peso dropped 0.9 per cent, while the Argentine peso fell 0.6 per cent, retreating from four-month highs earlier in the week. The Mexican peso and Brazilian real each declined about 0.4 per cent. A broader MSCI index of emerging-market currencies was little changed on the day.

Latin American equities also lagged, with a regional stock gauge down 1.4 per cent, diverging from the broader MSCI emerging-market index, which traded slightly higher.

Still, Latin American stocks remain among the best performers year to date, up nearly 20 per cent in 2026 — outperforming the 15 per cent gain in emerging markets overall.

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There are notable outliers, however. Argentine stocks have missed the broader Latin American rally as earlier euphoria surrounding President Javier Milei’s election victories has faded amid concerns over weak corporate earnings. The benchmark Merval index has flattened and is down about eight per cent this year.

With assistance from Winnie Hsu, Kerim Karakaya and Philip Sanders

Bloomberg.com