Emerging Markets Soar to New Highs, Shrugging Off Venezuela Risks

• Emerging-market stocks and currencies hit fresh records, driven by bullish sentiment and a shift from Venezuela geopolitical concerns.
• MSCI Inc.’s EM equity index rose 1.2%, with Chinese stocks reaching multi-year highs; EM bond risk fell to a 13-year low.
• Investor focus quickly moved past US intervention in Venezuela, turning to US economic data and the Federal Reserve's interest rate outlook.
• Chilean peso led gains, boosted by rising copper prices and the nomination of Jorge Quiroz as finance minister by President-elect José Antonio Kast.
• Emerging markets are seen as "stronger than ever" due to attractive valuations, potential central bank rate cuts, and AI value chain involvement.

Why It Matters: Emerging markets are experiencing a significant rally, driven by strong fundamentals and a quick recovery from geopolitical concerns.