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Iran war exposes big market concentration risk. It isn’t in US stocks

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Why Latin America could be the next international market to watch
Why Latin America could be the next international market to watch

Investors have poured money into emerging markets in recent years as the search for big stock gains has migrated overseas and as they look for diversification beyond the concentrated S&P 500. But the U.S.-Iran military conflict has reframed the concentration question, highlighting the level of risk in emerging markets when it comes to gains being dependent on a select number of stocks, many tied to the AI boom.

The iShares MSCI Emerging Markets ETF (EEM) has had strong performance over the past few years and into 2026, up 29% in 2025 and still holding onto a small gain this year. However, its holdings remain largely tilted toward Asia, with large exposure to China, South Korea, India, and Taiwan, together representing over three-quarters of the index weight, and many of the top stocks tied to tech, including Taiwan Semiconductor and Samsung.

“If you look at the index within emerging markets, it’s still roughly 80% Asia,” Malcolm Dorson, senior emerging markets portfolio manager and senior v.p. head of the active investment team at ETF company Global X said on CNBC’s “ETF Edge” earlier this week. “That gives you a lot of concentration risk,” he said.

Overall, the EM index has a 30%-plus tech sector weighting.

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South Korean stocks have experienced extreme volatility this week. The market posted its worst single-day move ever on Wednesday as the escalating war in the Middle East resulted in concerns about energy supplies to Asia, where top stocks in the memory sector fueling the AI boom rely on energy-intensive processes. After its worst day ever, the South Korean index rebounded on Thursday for its best day since 2008. The iShares MSCI South Korea ETF (EWY) is still down close to 13% this week.

Some of the enormous volatility in South Korean stocks is tied to how well they have performed recently, and how many retail investors have seen big gains from holding them. SK Hynix, a top holding in the broad emerging market indexes, gained 274% last year, while Samsung gained 125%.

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Performance of the iShares MSCI South Korea ETF over the past one-year period.

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A huge spike in oil prices since the outbreak of the military conflict has rattled global markets. On Friday, Brent crude futures topped $90 and U.S. West Texas Intermediate crude futures were closing in on that range, up more than 30% this week, while Brent has advanced nearly 26%.

The energy squeeze in Asian nations can be seen in China’s reported decision this week to tell domestic oil refining companies to stop any exports of fuel, and more Asian nations may follow with similar moves to retain energy stockpiles, energy market experts have said.

It isn’t time to abandon emerging markets, according to ETF investing strategists, and some macroeconomic factors may sustain outperformance in these markets over the longer-term. But Dorson said a “barbell approach” to investment strategy may be wise, balancing exposure between different types of emerging markets rather than relying on one region. He says thinking this way should lead investors who want to maintain international exposure to look at Latin America as a balance against Asian markets.

“I think you need to have both,” Dorson said.

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Countries like Argentina, Brazil, and Colombia are heavily linked to energy and commodities market, and he said rising oil prices can provide an additional tailwind for those economies. “I’d say 25 to 33% of the story should be that attractiveness of getting exposure to commodities,” he said. He added that there are also political reform efforts in Latin American nations that could serve as additional tailwinds for economies. “All eyes are on political change that could drive fiscal reform,” he said, and he added that may benefit financial services sector stocks across the region.

Equities in several Latin America markets also trade at significant discounts to U.S. stocks, with many price-to-earnings ratios roughly half those in the S&P 500. For example, Vanguard’s S&P 500 ETF, VOO, currently trades at a P/E ratio of 28, while its emerging markets ETF, VWO, trades at a P/E ratio of 18.

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Crypto World

Is XRP at Risk of Falling Below $1?

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XRP Exchange Netflow


“Our long-term target is $0.9000,” one analyst stated.

Ripple’s XRP has registered a minor uptick over the past week, coinciding with the broader cryptocurrency market’s revival.

However, some analysts believe its price may decline sharply in the near future and even fall below the psychological $1 level.

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New Pullback Ahead?

Earlier this week, XRP tried to reclaim the $1.50 mark but failed and now trades at around $1.39 (per CoinGecko’s data). The asset’s market capitalization stands at approximately $85 billion, making it the fourth-biggest cryptocurrency, trailing behind BTC, ETH, and USDT.

One person who has been closely monitoring its performance is the X user TradingShot. In their view, XRP has been moving within a downward channel throughout its entire bear cycle, which, according to the chart, began in July 2025 – shortly after the price reached its all-time high of over $3.65.

TradingShot noted that the severe decline in February this year hit the previous target on the 1W MA200, suggesting the asset’s next potential pullback may lead to a further drop to the 1M MA100 support, set at under $0.90.

“This level is critical as it formed the June 2022 bottom of the previous Bear Cycle. Our long-term Target is $0.9000,” the X user concluded.

X user WealthManager also presented a bearish forecast. They believe XRP looks “very dangerous” right now, warning that a “huge drop could be imminent.”

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Meanwhile, the prominent Bitcoin educator and advocate Adam Livingston spoke sharply against Ripple’s native cryptocurrency. He said he would rather have $100,000 in FTX customer refund claims than $100,000 in XRP.

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“At least SBF might send a heartfelt apology from prison before he dies of old age,” Livingston added.

The Bullish Scenario

Despite the pessimistic views some express toward XRP, many indicators suggest its price may head north soon. Numerous market observers pointed out that large investors have purchased almost 4.2 billion tokens (worth a whopping $5.7 billion at current rates) since the October 10 crash.

This development reduces the amount of XRP tokens available on the open market, and economic principles dictate that the valuation should rise if demand doesn’t diminish. Moreover, this shows that whales are confident in the asset and view lower prices as an opportunity, a signal that could encourage smaller players to follow suit.

XRP’s exchange netflow is next on the list. Over the past several weeks, outflows have consistently exceeded inflows, indicating that investors are moving their holdings off centralized platforms and into self-custody. This shift reduces the amount of coins immediately available for sale, easing short-term selling pressure.

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XRP Exchange NetflowXRP Exchange Netflow
XRP Exchange Netflow, Source: CoinGlass

The asset’s Relative Strength Index (RSI) is also worth mentioning. It has fallen to around 30 on a weekly scale, marking oversold territory that can sometimes be a precursor to a rally. On the other hand, ratios above 70 are considered bearish.

XRP RSIXRP RSI
XRP RSI, Source: CryptoWaves
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Crypto World

US National Cyber Strategy Pledges Support For Crypto And Blockchain

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Cryptocurrencies, United States, AI, Donald Trump, Quantum Computing

Crypto industry executives are combing through US President Donald Trump’s National Cyber Strategy after it was released on Friday, searching for hints about what it could signal for government support of the crypto industry.

“Crypto and blockchain are explicitly named as technologies to be ‘protected and secured.’ This is a first for any US cybersecurity strategy,” Galaxy Digital’s head of firmwide research Alex Thorn said in an X post on Friday.

Crypto and blockchain were mentioned once in the six-page report:

“We will build secure technologies and supply chains that protect user privacy from design to deployment, including supporting the security of cryptocurrencies and blockchain technologies.”

However, industry executives have also been interpreting other parts of the document to see how they relate to crypto.

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Cryptocurrencies, United States, AI, Donald Trump, Quantum Computing
Source: Mark Chadwick

Thorn pointed to a section pledging to “uproot criminal infrastructure and deny financial exit and safe haven.” “This language could easily justify crackdowns on mixers, privacy coins, and unregulated off-ramps,” he said.

Bitcoin VC points out that quantum has been taken “seriously”

Castle Island Ventures founder Nic Carter, who has been vocal about the threat of quantum computing to Bitcoin (BTC) in recent times, pointed to the section saying the government “will accelerate the modernization, defensibility, and resilience of federal information systems by implementing cybersecurity best practices, post-quantum cryptography, zero-trust architecture, and cloud transition.”

“Sure seems like they’re taking quantum seriously. Nothing to worry about, I’m sure,” Carter said in an X post.

It comes as the crypto industry continues to debate about how close quantum computing is to being a serious threat to Bitcoin. On Feb. 15, Carter said that major Bitcoin-holding institutions may eventually lose patience with Bitcoin developers for not addressing quantum computing concerns quickly enough.

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Trump points to the next generation as a priority

Trump said that the National Cyber Security outlines his priorities for “ensuring that America remains unrivaled in cyberspace.” Artificial intelligence was a key focus of the report.

“We will secure the AI technology stack—including our data centers—and promote innovation in AI security,” it said.

Related: Community banks and crypto industry ‘are allies’ in CLARITY Act debate: Exec

Trump also emphasized the importance of recruiting the next generation of workers in the cyber workforce to “design and deploy exquisite cyber technologies and solutions.”

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The US typically releases a national cybersecurity strategy every administration, outlining the government’s priorities for emerging technologies.

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