Emerging Markets Offer 40% Tech Exposure for AI Investors at a Steep Discount
Updated
Updated · Bloomberg · Jun 5
Emerging Markets Offer 40% Tech Exposure for AI Investors at a Steep Discount
3 articles · Updated · Bloomberg · Jun 5
Summary
Emerging-market stocks may offer the next major AI trade because investors have already heavily priced US AI leaders, while developing-market equities still trade at lower valuations.
Research Affiliates says EM indexes carry about 40% tech exposure—surprisingly higher than the US—giving investors broad access to AI-linked businesses rather than just a handful of American names.
That exposure is concentrated in semiconductors and internet platforms, including companies such as Alibaba, whose Qwen model shows meaningful AI development is not limited to US firms.
The broader thesis is that emerging markets may not produce the next Anthropic, but they could still capture a significant share of AI-driven investment gains over the coming years.
Is the real AI gold rush not in algorithms, but in the emerging market mines and factories powering them?
With China controlling critical AI minerals, is the West building its tech future on a foundation of geopolitical dependency?
Emerging Markets Tech Surge: EM Equities Outperform Nasdaq with 20% Gains in 2026, Driven by AI and Deep Tech
Overview
Emerging Markets (EM) have recently outperformed major global indices, achieving a 20% gain as of June 2, 2026, which is higher than both the US Nasdaq and other developed markets. This strong performance is supported by EM’s history of sustained growth and attractive valuations, offering a substantial discount compared to developed markets. Technical analysis suggests this trend could continue, potentially leading to a multi-year growth period. These factors make EM an appealing opportunity for investors seeking both value and growth, as the current environment favors further outperformance and long-term potential.