GEMs Best Stock Ideas May 2026 [Correction]

Research evidence excerpt

12 May 2026

GEMs Best Stock Ideas

Equity Strategy

Emerging Markets

May 2026 [Correction]

◆ We highlight 22 stock ideas across emerging markets

◆ These are our analysts’ best ideas based on their bottom-up

analysis…

◆ …and are also consistent with our top-down strategy

EM equities are back to all-time highs, but the breadth has collapsed with the share

of stocks beating the benchmark over the past year falling to a record low of 26%.

We expect this concentration in performance to persist. With geopolitical risks

elevated and the central bank outlook uncertain, valuation expansion looks unlikely in

the near term. Instead, returns should be driven by earnings momentum, and those

revisions are themselves narrow and have largely been confined to Korea, Taiwan,

and LatAm, and Tech, Energy, and Materials.

We also expect to see prolonged rotations within EM equities, given the risk that

disruptions around the Strait of Hormuz may be more persistent. Our Middle East

exposure scorecard flags Asia – particularly ASEAN and India - as one of the more

vulnerable regions given its reliance on imported energy, sensitivity to tighter financial

conditions, and more crowded positioning. LatAm stands out as a relative winner,

offering both a commodity hedge and stronger idiosyncratic stories. For more details

on our GEMs Equity Strategy views please see A concentrated but sustainable rally,

5 May 2026 and our GEMs Equity Strategy Quarterly, 2 April 2026.

Alastair Pinder, CFA

Head EM and Global Equity Strategist

HSBC Securities (USA) Inc.

Pankaj Agarwala*, CFA

EM and Global Equity Strategist

HSBC Securities and Capital Markets (India) Private

Limited

Herald van der Linde*, CFA

Head of Equity Strategy, Asia Pacific

The Hongkong and Shanghai Banking Corporation Limited

Raj Sinha*

Co-Head of Global Equity Research

HSBC Bank Middle East Ltd, UAE branch

Nicole Inui*, CFA

Head of Equity Strategy, Americas

Banco HSBC S.A.

* Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is

not registered/ qualified pursuant to FINRA regulations

In this report we present 22 stocks to own across EM that align with our strategy view and

where our analysts have high conviction.…