Tech overthrows financials as king of emerging markets

Hong Kong

THE rally in technology stocks may have more room to run after the industry overthrew financials as the main driver of emerging market shares last quarter.

Firms from South Korean phone makers to China's biggest internet company helped drive a 17 per cent surge in technology shares in the MSCI Emerging Markets Index in the first quarter, the best showing in five years. That pushed up their weight to 24 per cent, surpassing financial shares in the index for the first time since 2004.

BNP Paribas Investment Partners is doubling down on the sector, betting that earnings growth can sustain further gains. Societe Generale SA remains bullish as the growing prominence of Chinese consumers continues to drive ret…