Emerging-market stocks are on a tear.
"Monetary policy has become more hawkish, suggesting less risk of currency devaluation, and the earnings picture looks favorable, particularly for Asian markets," said Bank of America Merrill Lynch strategists in a separate note.
"Ten out of 15 EM countries are pricing in some probability of tightening rates over the next year. This is likely due to recovery in manufacturing Purchasing Managers’ Indices (PMIs) in Asia and EMEA and an acceleration in Chinese imports that is spilling over to broader Asia demand, and is reflected in our forecasts for steeper yield curves in much of EM this year."
US stocks rank comparatively high, although the so-called Trump rally has flattened in March.
Last year's winner is this year's loser so far.
Russia's stock market is the laggard this year after being one of the best performers in the world in 2016. Last year, the RTS index surged 54%, while the Micex gained 29%, supported by the rebound in oil prices and prospects that President Donald Trump would improve US-Russia relations.
Indian stocks are the big winners so far this year, as investors bet that economic reform in the country could improve earnings growth.
On Friday, the NSE index hit a record high for the third time this week after Prime Minister Narendra Modi's party achieved a strong election win in the key state of Uttar Pradesh. Investors are hopeful that Modi will get re-elected in 2019 and implement his reform agenda, Reuters reported.
South Korea is another high flier, and could be headed into a period of uncertainty following President Park Geun-hye's impeachment.
Biotech stocks are leading across sectors.
Among these indexes of 23 developed and 23 emerging markets, the biotech sector is leading the pack. Johnson & Johnson, the top constituent of the index, has jumped 26% since its late-January acquisition of the Swiss biotech company Actelion for $30 billion in cash.
The peso is shrugging off concerns about Trump.
The Mexican peso suffered its worst tumble since 1994 right after the election. It was considered particularly vulnerable to the election's outcome given Trump's anti-trade and anti-immigration remarks during his campaign.
But the peso has defied expectations and is the best performing currency in the world so far this year. It has been helped in part by positive comments from US officials. Earlier this week, Peter Navarro, Trump's trade adviser, told Bloomberg that the US and Mexico had the opportunity to "develop a mutually beneficial regional powerhouse" for workers and manufacturers.
US oil producers are undermining OPEC.
Natural gas prices have tumbled amid unseasonably warm weather, which implies weaker demand for heating. The US had its second-warmest February ever on record, according to the National Centers for Environmental Information.
Crude oil is also a big loser, likely to the dismay of the Organization of Petroleum Exporting Countries. Some OPEC members including agreed last November to reduce their output. However, shale oil producers continue to revamp their output after a slump. In any case, US antitrust laws prevent US-based companies from entering agreements that would regulate prices.
On the winning side is iron ore, which has been ripping higher amid strong demand from China.
