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Additional Reading from MarketBeat Media If Emerging Markets Outperform, This Stock Could Lead the ChargeWritten by Ryan Hasson. Publication Date: 1/11/2026. 
In Brief - A weakening U.S. dollar and potential rate cuts have fueled strong emerging-market performance, with EEM up more than 34% over the past year and seeing steady institutional inflows.
- Alibaba stands out as a concentrated emerging-market play, showing a constructive technical setup after holding key support near $150 and setting up for a potential breakout above $160.
- With reasonable valuation, bullish analyst targets, and accelerating AI and cloud investment, Alibaba could reemerge as a leader if emerging-market momentum continues.
Over the past 12 months, the U.S. dollar has weakened significantly, and with further rate cuts possible, that trend may persist against several major emerging-market currencies. That shift has helped fuel a strong rally across emerging market equities, with the iShares MSCI Emerging Markets ETF (NYSEARCA: EEM) surging more than 34% over the past year. While pullbacks within any broader trend are inevitable, continued dollar weakness could encourage additional capital rotation into emerging markets as U.S. investors look to diversify beyond domestic equities. For broad exposure, EEM remains one of the most widely used and liquid vehicles for accessing this theme. The ETF tracks the MSCI Emerging Markets Index, providing exposure to large- and mid-cap equities across countries such as China, Taiwan, India, Brazil, and South Korea. It also offers a modest income component, with a dividend yield of 2.1%. Institutional positioning suggests confidence in the trend as well, with roughly $5.5 billion in inflows over the past 12 months versus $3 billion in outflows. Recent algorithm alerts have flagged stocks like Nuburu, MSS, and Rebel Holdings ahead of sharp moves — including triple-digit gains in a short time frame. These signals all came from Tim Bohen's new system, called The Monday Algo, which scans the market each week for early breakout setups.
Now, the algorithm is highlighting a new low-priced stock heading into Monday. While no trade is guaranteed, Tim is breaking down why this setup stands out — and how he and his students approach these Monday momentum opportunities. See the latest Monday Algo setup here While EEM is well-suited for investors seeking diversified exposure, some may prefer a more aggressive way to express a bullish view on emerging markets. That often means concentrating on individual stocks rather than relying solely on an ETF. One name in particular, which carries a 3.16% weighting in EEM, stands out for its technical positioning. Alibaba: A Potential Emerging Markets Leader Alibaba Group Holding (NYSE: BABA) remains one of the most influential companies within the emerging markets universe. The Chinese multinational technology and e-commerce giant has a market capitalization of roughly $368 billion and plays a central role in online retail, cloud computing, logistics, and digital payments. From a technical standpoint, BABA is presenting a compelling setup. After breaking out to new 52-week highs last September, the stock pulled back in a controlled and constructive manner. Importantly, shares found support near $150, which previously acted as resistance. That successful retest suggests the stock may be forming a higher low within a developing longer-term uptrend. A sustained move above $160 would likely confirm the next leg higher and could attract renewed momentum-driven flows, particularly if emerging markets continue to outperform. On the fundamentals side, valuation appears reasonable relative to Alibaba's scale and long-term growth profile. The stock trades at about 21 times earnings, with a forward P/E near 17. Analysts remain generally bullish, with a consensus price target of $191.84, implying roughly 24% upside from current levels. Institutional flows, however, tell a more nuanced story. During the third quarter of last year, institutions were net sellers, offloading about $29 billion in stock while institutional buying totaled just under $4 billion. Much of that selling came after a sharp rally from March lows near $80 to a September peak just below $193, suggesting profit-taking rather than a material change in the company's fundamentals. The key question now is whether capital will rotate back into the name if emerging-market momentum remains intact. AI and Cloud as the Next Catalyst One potential catalyst lies in Alibaba's expanding AI and cloud initiatives. Recent reports that select Chinese companies, including Alibaba, may gain access to NVIDIA's H200 chips for commercial use could provide a meaningful tailwind. While Alibaba's core e-commerce business has faced pressure from discount-focused competitors, its AI-driven cloud segment continues to grow rapidly. Alibaba Cloud controls nearly one-third of China's AI cloud market, and the company has committed over $50 billion over the next three years toward cloud and AI infrastructure. If emerging markets continue to attract capital and Alibaba can reclaim and hold key technical levels, the stock appears well-positioned to lead the next phase of outperformance within the space.
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