Bank of America says the foundation of the emerging markets bull market is solid, and the duration of the war will determine capital flows.

格隆汇 March 5｜Bank of America Securities strategists stated that even though Middle East conflicts have disrupted risk assets, investors have not lost confidence in emerging markets. Strategists, including John Morris, wrote in a report that before the outbreak of the Iran war, developing countries were at the "peak of investor optimism." Despite rising tensions at the time, capital inflows into Eastern Europe, Middle East, and African stock markets still hit record highs. The strategists pointed out that this has created a "large base" for potential unwinding actions if the conflict becomes prolonged, as rising energy prices are threatening the global economy. However, everything depends on how long the war lasts. Morris and his colleagues believe that if the conflict can be resolved quickly, it may once again confirm optimistic expectations for emerging markets. They added: "At least so far, investors do not seem willing to abandon their positive structural views."