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Emerging markets rebound on inflows as Xi-Trump talks eyed for momentum
Mainland China, Hong Kong stock markets may benefit from Xi-Trump meeting as renewed interest in AI shows investors keen to re-engage, analysts say
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Themis QiPublished: 2:11pm, 12 May 2026Updated: 5:53pm, 12 May 2026
Global funds came back to emerging markets in April with an inflow of US$58.3 billion, which is expected to continue in coming months amid the recovery from the previous geopolitical panic.
It comes as renewed enthusiasm in artificial intelligence has started drawing some global funds back to US stocks, but analysts said mainland and Hong Kong markets may benefit from this week’s meeting between President Xi Jinping and US President Donald Trump.
According to a report by the Institute of International Finance (IIF), the April non-resident portfolio growth in emerging countries – varying from China to Brazil – rebounded sharply, reversing the outflow of US$66.2 billion in March and US$42.2 billion in April last year.
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The swing indicated that investors were willing to re-engage quickly once the initial geopolitical panic faded and primary market windows reopened, said Jonathan Fortun, senior economist at the IIF, in a note on Monday.
“With the easing of Middle Eastern conflicts, global markets [are] likely to further recover,” said Kenny Ng Lai-yin, a strategist at Everbright Securities International. “The emerging markets will even be able to sustain their upward momentum.”Advertisement
The capital inflow in April was recorded in both stocks and credit. IIF recorded an influx of US$6.4 billion in equity markets and US$51.9 billion from debts, versus an outflow of US$65.5 billion and US$700 million last month respectively.
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