GEMs in the week Turning down the volume

Research evidence excerpt

GEMs in the week Turning down the volume

10 July 2026

GEMs in the week Multi-AssetEmerging Markets

Turning down the volume

◆ Escalating geopolitical developments have brought the Edward Parker, CFA

Middle East conflict back into focus… Emerging Markets Strategist

HSBC Bank plc

edward.parker@hsbc.com

◆ …at a time when supply chains were showing tentative signs +44 20 3359 7563

of improvement… Ali Cakiroglu

Emerging Markets Strategist

◆ Amidst the noise, we continue to look for the real signal: the HSBC Bank plc alicakiroglu@hsbc.com

normalisation of traffic through the Strait of Hormuz +44 20 7991 0547

Ramya R S

Still looking for the signal through the noise HSBC Bank Middle East Limited, DIFC

ramya.r.s@hsbc.com

The latest developments in the Middle East provide yet another reminder to not get too + 971 4 509 3351

comfortable as we head into the summer. This week’s tit-for-tat strikes between the US Rohit Mehboobani*

and Iran, including US President Trump declaring that the ceasefire was over Associate Bangalore

(Bloomberg, 8 July), pushed emerging market assets lower and brent crude up to around

USD76/bbl. These shifting narratives are something we are becoming increasingly * Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is

familiar with (HSBC Global Macro Strategist: Shifting narratives, 25 June 2026). not registered/ qualified pursuant to FINRA regulations

Prior to the latest geopolitical escalation, there were some signs of relief in the EM

inflation backdrop. For one, oil prices had declined significantly, while the vast

majority of May CPI data surprised to the downside (GEMs in the week: Inflation

relief: Food, fiscal, forecasts, and now oil, 19 June 2026). On top of that, the growing