Developing economies feel force of global sell-off

Emerging market equities saw their biggest one-day falls in two decades on Monday as the growing global financial crisis swept across the developing world. Nearly every emerging market was hit by the dramatic deterioration in sentiment as currencies and bond prices plummeted to record lows amid a flight from riskier assets. Ian Harnett, of Absolute Strategy Research, said: “The market has woken up to the fact that this is a global economic crunch. It is not just about the credit markets.” Nigel Rendell, senior emerging market strategist at RBC Capital Markets, said: “The bottom line is the credit crunch has spread from the US to Europe. What we are seeing is the liquidation of everything that is remotely risky – and that means emerging market assets. “We have seen this trend over the past weeks – and it is simply increasing... [read full story]