The EM winners and losers from falling commodity prices

Richard Titherington, chief investment officer emerging market equities at J.P. Morgan Asset Management, takes a closer look at the benefits of dividend-paying stocks as investors struggle in a challenging environment

Emerging markets are currently fighting an uphill battle against a number of headwinds. Some of these headwinds are in the form of external shocks, such as commodity price weakness, the potential for higher US interest rates (see chart 1), and the strength of the US dollar. Others are problems of their own making - Russia being the most prominent recent example. This has become an all too familiar pattern to investors in the asset class in recent years. In fact, the MSCI Emerging Markets index ended 2014 very close to the lows reached in each of the prior three years, when market fears p...