Analyst Weekly, March 23, 2026
Markets are more and more being pushed by a single power: vitality. As tensions within the Center East disrupt provide routes and push vitality costs larger, asset costs are shifting much less on fundamentals and extra on publicity to that shock.
On this setting, not all areas will react equally. These tied to vitality imports are dealing with stress, whereas exporters, and extra broadly, commodity-linked markets, are beginning to behave otherwise.
Latin America: From excessive beta to macro lever
Latin America has traditionally been characterised as a higher-beta phase of world equities. However to date in 2026, it has behaved otherwise.
Whereas world equities wobble on geopolitics and fee uncertainty, Latam is quietly main rising markets, up round 7% year-to-date, supported by commodity publicity, bettering coverage dynamics, and nonetheless undemanding valuations.
That shift is just not coincidental. The present macro setting is more and more being pushed by vitality dynamics and supply-side shocks, and Latin America is structurally positioned inside that development. The chance sits on the intersection of a near-term macro shock and a longer-term structural shift towards actual property.
Valuations: a supportive backdrop
From a valuation perspective, the area stays constructive.
Markets throughout LatAm have de-rated in current weeks, with most international locations now buying and selling under their long-term common multiples, whereas earnings expectations have held comparatively regular.
In our view, this creates a extra balanced setup, the place,
Costs have adjusted
Earnings haven’t meaningfully deteriorated
Funding Takeaway: That mixture supplies a level of valuation assist, notably relative to extra crowded world fairness markets.
Actual property are again in focus
On the core of the Latam story is its publicity to actual property.
The area is a key provider of:
Power (with a big share of world reserves and exports)
Industrial metals similar to copper (Chile, Peru)
Strategic supplies like lithium and uncommon earths (Chile, Argentina, Brazil)
In a market formed by provide constraints and geopolitical fragmentation, these exposures have regained relevance. Importantly, Latam indices should not impartial: vitality alone represents a significant share (round 9%) of the benchmark, permitting the area to translate commodity energy immediately into fairness efficiency.
Funding Takeaway: For retail traders, this reveals up throughout each indices and devices. Benchmarks like MSCI Latam and nation indices similar to Brazil’s Bovespa or Mexico’s IPC mirror this commodity tilt. Entry will be gained by means of ETFs like iShares MSCI Brazil ($EWZ) and iShares Latin America 40 ($ILF), or by way of particular person names tied to the cycle.
Amongst these, large-cap exposures similar to Petrobras, Vale, and Gerdau seize vitality and supplies, whereas corporations like Cemex supply leverage to infrastructure and building. On the identical time, extra domestically linked or cyclical names similar to Embraer, Localiza, and LATAM Airways, mirror the restoration and progress aspect of the story.
Brazil because the portfolio anchor
Inside Latin America, Brazil stands out with:
Direct leverage to commodities
A central financial institution transitioning towards easing
Continued international investor participation
This alignment between exterior tailwinds (commodities) and home coverage (fee cuts) is comparatively uncommon throughout rising markets.
Flows have remained comparatively resilient, notably in Brazil, suggesting positioning is constructing however not but stretched.Â
Brazil additionally represents a broad cross-section of alternatives on the inventory stage. Latest market volatility has led to pullbacks throughout a number of names, together with Embraer, JBS, Santander Brasil, XP, spanning industrials, client, healthcare, and financials.
For traders, Brazil typically turns into the core allocation, accessed by means of ETFs or diversified publicity to those massive and mid-cap names.
Understanding the chance
Latin America stays a cyclical allocation, with two key sensitivities:
A stronger US greenback
A deterioration in world threat sentiment
Traditionally, the area underperforms during times of USD energy, even when commodity dynamics stay supportive. A pointy reversal in oil costs or a sustained USD rally would doubtless weaken the relative case for the area.
From a portfolio perspective, this introduces a forex dimension to the commerce. Some traders might select to go away FX publicity unhedged to seize potential upside from commodity-linked currencies, whereas others might partially hedge FX threat to isolate the fairness part and scale back volatility.
Funding takeaway
For traders, Latin America is greatest understood as a selective allocation inside a broader portfolio, reasonably than a standalone name.
It might probably play a number of roles:
A diversifier away from US-heavy fairness publicity
A commodity-linked sleeve in a supply-driven macro setting
A differentiated entry level into rising markets, with distinct drivers
Implementation can range, from broad ETFs and large-cap equities to extra thematic exposures.Â
Defensive Positioning Dominates, however the Structural Story Is Advancing
The crypto market is in a transition part the place weak sentiment contrasts with a strengthening structural backdrop.
Positioning is clearly defensive. Worry & Greed sits at 27 (worry), whole market cap has pulled again to ~$2.44T, and volumes stay reasonable, suggesting no aggressive dip-buying but. BTC dominance has risen to ~56.3%, reinforcing the concept of capital rotating into security whereas altcoins underperform.
ETF flows are additionally telling: weekly flows have are available in broadly flat, pointing to a pause in institutional momentum reasonably than lively accumulation. Mixed with retail risk-off habits, this explains the shortage of upside follow-through.
Underneath the floor, nevertheless, the structural story is advancing. The Readability Act is shifting towards a possible settlement within the U.S., with bipartisan assist and lively negotiations between banks and crypto companies, notably round stablecoin yield.
Stablecoins are on the middle of this shift. Their rising position, particularly on Ethereum, highlights the place actual adoption is occurring. Capital is beginning to differentiate between property with precise utility and people pushed purely by narrative.
The long-term thesis stays intact: integration into the monetary system, enlargement of stablecoins, and rising institutional involvement. The market is just not totally pricing this but.
Technically, the setup is softer however nonetheless orderly. BTC dropping $70K opens a transfer towards $65K, with $55K as the important thing structural stage under. ETH wants to carry $2,000. These are reference zones that may decide whether or not this stays a managed correction or evolves right into a deeper transfer.
This communication is for info and training functions solely and shouldn’t be taken as funding recommendation, a private suggestion, or a proposal of, or solicitation to purchase or promote, any monetary devices. This materials has been ready with out considering any explicit recipient’s funding goals or monetary scenario and has not been ready in accordance with the authorized and regulatory necessities to advertise unbiased analysis. Any references to previous or future efficiency of a monetary instrument, index or a packaged funding product should not, and shouldn’t be taken as, a dependable indicator of future outcomes. eToro makes no illustration and assumes no legal responsibility as to the accuracy or completeness of the content material of this publication.
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