Bloomberg
Published Oct 08, 2019 02:59AM ET
Updated Oct 08, 2019 03:55AM ET
(Bloomberg) -- Trade war-hardened emerging-market investors aren’t counting on any breakthrough in trade negotiations as talks between the U.S. and China are set to resume Thursday in Washington.
BNP Paribas (PA:BNPP) Asset Management has been reducing its exposure in junk-rated debt, while Union Investments Privatfonds GmbH is favoring investment-grade rated bonds over high-yield debt. And in case any breakdown in discussions triggers a flight to safety, Aviva (LON:AV) Investors has been been buying the yen.
“We expect another empty-handshake meeting,” said Bryan Carter, London-based head of emerging-market fixed-income at BNP Paribas Asset. Ultimately, no substantive agreement will be reached, he said.
Emerging-market stocks have rebounded as much as 5.8% from early September, when China and the U.S. announced they would hold face-to-face negotiations once again. The rally has since petered out after President Donald Trump said he won’t seek an interim agreement and global growth showed further signs of deterioration as the year-long trade war dragged on. Impeachment proceedings have also spurred concern that it may hinder Trump’s hand in the negotiations.
Below are comments from investors and analysts:
Sergey Dergachev, senior portfolio manager at Union Investment in Frankfurt:
Written By: Bloomberg
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