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Nick Chamie of RBC Capital Markets on which economies stand to bear the brunt of an unraveling Europe.
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We'll buy that making -- call.
Texas Spain's stock market sank nearly 3% today.
Growing fear that a political stalemate -- force that nation out of the eurozone.
So what is -- -- for your investments especially in emerging markets which had been so hot for so lot for joining me now is nick Sammy.
Head of emerging markets research RBC capital markets -- -- it.
What are your thoughts first and foremost on the European situation as Greece out.
Yeah that's definitely going to have that's certainly the question on -- -- of everybody in the market.
And obviously it's unclear at this point but the risks have.
Significantly elevated in comparison to where they've been.
In the most recent history and we think that third piece from -- that way.
OK so which economy stand to bear the brunt.
Of an unraveling Europe.
Outside of -- -- well it definitely.
Outside of European and central and Eastern Europe.
The countries.
Such as Poland Hungary Czech.
They're heavily tied of course into the Western European economies -- currencies have taken.
A significant beating in recent weeks obviously there in the front line.
But also in -- America and Asia.
You have -- significant banking ties with the European banks with upwards of two point six trillion dollars with the banking assets and emerging market countries.
And these are at risk as.
European banks are under pressure to.
It's going to impact across the emerging markets what.
The export dollars right emanating from Europe and not going to emerging markets in many cases now -- is that going to really -- -- economic growth.
In Latin America in particular.
Yeah absolutely in fact.
I think it's Asia where -- are likely to see the largest impact.
Asian export growth has suffered tremendously in the last few months on a year over year basis we've seen negative.
Export growth over the last two or three months and some of the large.
Heavyweight exporters in the region.
Or are suffering tremendously because of the -- European demand growth.
So what did we are facing you're investing in income definite start it talk over you there after wrapping up did you catch my question.
Not let's find.
Yes.
What we're looking forward.
Is a continuation of our view that.
Investors should remain defensive and we've began that view but back in late Q1 early Q2.
We think that that continues right through to mid year and possibly bleeding into the third quarter.
The best thing to to do right now is to keep your risk exposures.
Relatively defensive end look for the first signs of a bottoming out process which still -- so far away at this point.
Thank -- much -- -- RBC capital markets.
