Carmignac Portfolio Emergents

After a very turbulent April, the announcement of a moratorium on tariffs between the US and China pushed markets into positive territory.

In China, economic indicators declined, with the Caixin manufacturing PMI coming in at 50.4 for April and the services PMI at 50.7.

Commodity prices (oil, soybeans, copper) remained stable over the period.

We benefited in particular from our exposure to technology stocks and Taiwanese stocks (TSMC, Elite Materials and SK Hynix).

Our selection of Mexican stocks also contributed positively this month, notably the financial group Banorte and the real estate company Vesta.

However, the fund was slightly penalized by the underperformance of Indian stock Kotak Mahindra and Brazilian stock Eletrobras, after an excellent start to the year on the stock market.

Furthermore, emerging markets are benefiting from uncertainty in the United States, as Trump's policies seem to be having the opposite effect, benefiting emerging markets.

We remain constructive on China, given the change in perception. Markets are realising that geopolitical tensions are hurting China but not destroying it. Moreover, technological progress, particularly in AI and productivity, should provide further stimulus to the economy. This is why we want to maintain decent exposure to China, with a slight underweight. Our Chinese portfolio is mainly composed of technology/innovative companies.

During the month, we increased our position in Prosus, Tencent's parent company. We believe Tencent is well positioned to benefit from China's catch-up in AI and could potentially launch the world's first AI agents or assistants. We are maintaining a significant allocation to India, where the long-term outlook remains promising (strong growth, political stability, solid current account balance).

The recent correction offers attractive entry points for the stocks we are tracking. We took advantage of the correction at the beginning of the year to increase our exposure to India by strengthening our positions in the e-commerce, tech and insurance sectors, which have fallen sharply.

Finally, we remain very constructive on our Latin American portfolio, which appears to be benefiting from the new global economic order, as it is less affected by customs tariffs than Asia. Mexico seems to have been relatively spared by Trump's initial announcements, which reinforces our view that this country should gain significant market share in US imports.