Asia's technology boom

Synopsis

The tech sector in emerging markets experiences a significant boom, becoming the largest grouping in the e/m universe this year. This surge follows the best year for emerging market equities since 2009, with the benchmark index rising 17%. Key players in this rally include Chinese companies like Alibaba, which sees a 62% increase, and Tencent, up 43%. The tech sector overall has risen 38% this year, driven by earnings upgrades, particularly in Asia, which constitutes two-thirds of the index. The demand for chips and specialized components fuels this growth, as emerging market economies develop a middle class with increasing disposable income. Notably, Taiwan Semiconductor, the world's largest chip foundry, gains 18%, while Samsung Electronics rises 35%. The upcoming launch of Apple's iPhone 8 models adds to the speculation around tech sales, with a significant portion of Taiwan's tech sales linked to iPhone production.