Emerging market stocks close to biggest weekly jump since 2020

Ahead of the start of U.S.-Iran talks in Pakistan, emerging market stocks are nearing their biggest weekly gain in nearly six years, Bloomberg noted. Separately, stocks in Asia may record their best week since November 2022, Reuters wrote.

Amid a fragile two-week truce between Washington and Tehran and Israel's willingness to negotiate with Lebanon, investors are hoping for a further easing of tensions in the Middle East.

The MSCI Emerging Markets Index of emerging market stocks rose 0.95% on April 10. Over the last week, it added about 7%, according to Investing.com data. Such a jump could be the biggest weekly gain for the index since June 2020, Bloomberg writes.

The broad MSCI index of Asia-Pacific shares excluding Japan is showing similar dynamics - it is up 0.93% on April 10 and could post a 7.3% gain for the week, which could be its highest since November 2022.

Ahead of the start of U.S.-Iran talks in Pakistan, high-tech stocks in Taiwan and South Korea also collectively attracted $7.9 billion in net foreign investment this week, breaking more than a month of outflows, the agency calculated. And while the weekly inflow of funds in this sector is not yet comparable to the record outflow of $70 billion in March, the current dynamics indicate that some investors are ready to return to growth stocks, despite persistent geopolitical risks, Bloomberg notes.

The optimism is also supported by signs of positive profit dynamics of Asian technology companies. For example, Samsung Electronics reported this week that it expects an eight-fold increase in profits for the first quarter of 2026, indicating strong demand for AI chips. And TSMC reported 35 percent revenue growth for the same period, beating market forecasts. Samsung Electronics shares have added more than 10 percent in Korea over the past five days. TSMC shares are up 7.8 percent over the same time.

"Reduced tensions in the Middle East have prompted investors to increase their investments in emerging markets," said Gama Asset Management SA global macroeconomic portfolio manager Rajiv De Mello (quoted by Bloomberg).

"Investors believe the war [in the Middle East] is winding down, so the bet on Asian AI infrastructure providers is coming back," added Wei-Sern Ling, managing director at Union Bancaire Privee. - In addition, Samsung's strong earnings guidance this week has also underpinned the optimism we are seeing," he noted.

US President Donald Trump on April 9 said he was "optimistic" about a deal with Iran, but later threatened Tehran over charging fees for ships passing through the Strait of Hormuz.

The U.S. and Iranian delegations are scheduled to meet in Islamabad on Saturday, April 11. One of the main points of contention during the talks will be shipping through the Strait of Hormuz, through which a fifth of the world's oil shipments by sea and a significant portion of LNG were transported before the war. However, amid fighting since late February, the Strait of Hormuz remains largely closed to shipping.

This article was AI-translated and verified by a human editor