Emerging Markets Outlook Analyzed

Key Points

• India’s economy is growing quickly, boosting investor confidence.
• Lower interest rates and reduced inflation are expected globally.
• Global fund managers are shifting investments from China to India.
• Attractive valuations and technical factors are driving market interest.
• Structural reforms and policy changes support broader EM growth.
• Favorable conditions are predicted to continue emerging market gains.

India’s Improving Outlook

Ashmore Group, a company that manages investments in developing countries, believes India’s stock market is about to get a major boost. They predict this will happen in 2026. This prediction is based on recent changes and growing signs of strength in India’s economy.

Gustavo Medeiros, who leads research at Ashmore Group, says India’s economy is growing faster than expected. Specifically, India’s economy grew by 8.2% from July to September of 2025. This growth is mainly due to the manufacturing industry, which grew by 9.1% during that same period.

Even with some worries about tariffs from the United States, India’s economy is still doing well. This is because new ideas are emerging, like China focusing on selling more goods and the rise of artificial intelligence (AI) investments.

These changes mean that investors are starting to see India as a good place to put their money. Ashmore believes India’s stock market will become more attractive, and they plan to invest more money there.

Ashmore sees similar positive trends happening in other developing countries across Asia, Latin America, Eastern Europe, and Africa. Governments are making changes that are making economies more stable, leading to better ratings for these countries and more money flowing in from investors.

The company predicts that these positive trends will continue, leading to strong growth in emerging markets overall. They believe India will be a key part of this growth, along with other developing nations benefiting from improved stability and attractive investment opportunities.

“The overall outlook for emerging markets, particularly India, is positive, driven by fundamental economic strengths and favorable global dynamics.”