In the six charts below we plot the ICE USD index (blue line, left axis, inverted) against the relative performance in USD of each of the six MSCI developed and emerging market regions relative to the MSCI All Country World Index (red line, right axis). Here is a breakdown of the relative performance since our post last week:
- Relative performance of North American stocks has improved, though has not broken out to a new high
- Relative performance of Europe has suffered, but has not broken out to a new low
- Relative performance of the Pacific region (which is mostly Japanese stocks) has continued to improve - this may have something to do with the fact that the yen has been stable
- Relative performance of EM Asia has deteriorated just slightly
- Relative performance of EM EMEA has suffered and is close to making a new cycle low
- Relative performance of EM Latin America has suffered and has made a new cycle low
So it appears that Europe and ex-Asia EMs are taking the brunt of the pain while North America and Japan are benefiting from this latest bout of USD strength.