The 6-pack below reflects that BRIC ( Brazil, Russia, India & China) and Emerging markets are close to or are breaking key support lines.
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Many pundits continue to tell us that Emerging markets are the growth engine of the world. In time this idea may end up being true! What has been the case over the past few years? While the Dow and S&P 500 are at or near new all time highs, BRIC/Emerging markets are well below their 2007 highs.
Not only are these emerging markets below the 2007 highs, most are attempting to break below important support lines, with patterns looking very similar to Copper. The relative weakness in these markets continues to suggest that when it comes to portfolio construction, under weighting towards these countries remains a good idea!
Could “Falling BRIC’s/Emerging Markets” impact the S&P 500 and Europe? Yes…If BRIC’s can stop falling here, it would be a good sign for older established countries!