Emerging Markets Assets Rebound in April After Iran War Sell-Off

Emerging market assets saw significant net inflows in April, recovering from a sharp sell-off in March following the Iran war. The bond market primarily drove this recovery.

Tue May 12 2026

Emerging Market Assets Recover Post-Iran War

According to data released by the Institute of International Finance (IIF), emerging market assets, which experienced a significant sell-off in March due to the Iran War, largely rebounded in April. Net inflows into emerging market bond and equity markets totaled $58.3 billion in April, nearly recouping the $66.2 billion outflow observed in March. While equity sales dominated in March, the bond market led the recovery in April.

The emerging market bond sector saw a turnaround from a $68.2 billion outflow in March to a $51.9 billion inflow in April. Equities also recovered, with $6.4 billion in inflows after a $65.5 billion outflow in March. High-performing markets like South Korea and Taiwan spearheaded this recovery, with the MSCI Emerging Markets 24-country stock index recording its highest monthly gain in approximately 20 years.

Continued Pressure on Energy Importers and Future Outlook

The IIF noted that while the capital flow data suggests an easing of immediate funding pressures, it does not indicate that underlying shocks have been absorbed. They highlighted that pressures remain high for energy-importing nations, corporations, and central banks. The IIF also posed the question of whether April's rebound marks the beginning of a sustained normalization or merely a temporary counter-reaction after the extreme adjustment in March.

Excluding China, bond inflows to emerging markets increased from $13.8 billion in March to approximately $50 billion in April, while equity inflows shifted from an outflow of around $63 billion to an inflow of $5 billion. Latin America, one of the best-performing regions, attracted $13 billion in April alone. The Africa and Middle East region saw $7.3 billion return to bonds after a $6.5 billion outflow in March, though equity outflows of $713 million partially offset this.

*Source: ニュズウィーク日本版 (2026-05-12)*

Tags: #EmergingMarkets #IranWar #IIF #BondMarket #EquityMarket