Emerging markets began the year on a strong note and outperformed developed markets, as they were driven by economic indicators and the global growth that could result. The dollar’s retreat also drove the rally. Commodities as a whole fared well, unlike energy, which pulled back slightly.
The trend was driven mainly by cyclicals, such as basic materials and techs.
Geographically, India is gradually recovering from demonetisation, but remains a challenging story, and Asia in general fared well, driven by China against a backdrop of good Q4 2016 numbers.
In Latin America, Brazil continued to rally steeply, driven by monetary stimulus, but Mexico continued to suffer from the downturn in its relations with the United States.