The Brazilian stock market had a great week and the iShares MSCI Brazil Capped ETF (EWZ – 48.52) reflected the enthusiasm rising almost 4% on the week. EWZ bottomed out at 41.26 on August 21st of this year and one month later it has rallied 17.5% as of Friday’s close. Those daring souls that stepped up last month in the face of overtly bearish sentiment have been handsomely rewarded. Despite this aggressive run by EWZ, VXEWZ still remains at fairly elevated levels and was basically unchanged this past week.
The rest of the emerging market world had a good week as well with the iShares MSCI Emerging Markets ETF (EEM – 42.08) gaining over 2%. The 2013 low for EEM came in late June and the fund has rallied over 16% from that level. Volatility was lower on the week with VXEEM losing 3% and settling at 23.55. The curve shifted in a fairly parallel fashion and has a nice normal contango shape showing a fairly bullish outlook continuing through the end of 2013.