A screen shows stock market prices inside a brokerage in Taipei, Taiwan. Photo: Reuters / Pichi Chuang

While bond yields jumped in anticipation of less central bank accommodation, emerging equity markets responded in very different ways. Most of the Asian markets were up overnight (SENSEX +0.65%, KOSPI +0.91%, SET +0.47%, TAIEX + 0.47%, Malaysia KLCI +0.9%).

Brazil was down 0.5% at 8:00 am EST, and Turkey was down 0.77%. China also fell, but in response to a warning in Beijing Daily by Fang Hengshan, a top Chinese economic planner, that “black swan” events were a danger for 2018.

The difference is that Brazil and Turkey run substantial current account deficits. Countries that depend on borrowing will suffer from rising yields, while countries that lend to others will not.

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