The $4.5 trillion slump in emerging market equities has dealt the worst blow to South Africa, dragging the valuation of its benchmark index to the lowest level since the Taper Tantrum.
When national markets are compared with their own historical valuation levels, based on price as a multiple of projected earnings, Asia and Africa come out the worst after a sell-off that began in January pushed the developing world into a bear market. Money managers often cite South Africa as the most open and liquid emerging market, explaining why it tends to suffer the most in any rout.
The fast-growing economies of India and Philippines haven’t been spared either as they slipped to deeper lows. By this reckoning, most Latin American markets are relatively stable.