Emerging Markets Make a Comeback Amid Global Trade Tensions

Stocks in major emerging markets rebounded after recent declines, with MSCI's index tracking a 0.3% rise. Investors remain cautious due to ongoing global trade tensions, especially between China and the U.S. Countries like Japan are pursuing trade talks with the U.S., and various indices showed mixed performance.

Stocks across major emerging markets rose on Tuesday, rebounding after experiencing sharp declines in recent sessions. This upward movement came as the global trade war continued to create uncertainty among investors. MSCI's index, which tracks equities in developing markets, saw a 0.3% uptick following its largest one-day decline since the 2008 financial crisis.

Countries including Japan, Vietnam, and Israel negotiating trade deals with the United States provided further impetus for risk-taking in the markets. Stock indices around the world reflected mixed performances, with Israel's main index rising by 1%, India by nearly 2%, and central and eastern Europe's by 1.8%. Turkish stocks showed a gain of 0.7%, but Vietnamese stocks fell 6.4%.

Even as Chinese stocks experienced a 1.7% rise, driven by Central Huijin Investment's intervention in the capital market, investors remain wary of a possible escalation in the trade war between China and the U.S., along with potential European Union retaliation. A devaluation of the Chinese yuan is feared to create further weakness in emerging markets.

(With inputs from agencies.)