Prices have rallied in almost every emerging market, led by Mexico itself, where share prices have recovered almost 80 per cent from the low point at the end of February. With hindsight, investors who pulled their money out of Mexico would have done better to leave it there.
Argentina has regained 50 per cent, while most Asian markets suffered less and are at least 10 per cent above their low points. The traditionally volatile Hong Kong market has risen over a third since January, despite recurring bouts of uncertainty over relations with China, highlighted by the current elections held in defiance of Beijing.
Taiwan has also been shaken by political doubts, caused mainly by the resumption of nuclear testing by mainland China, and share prices fell 40 per cent from the start of the year before bottoming out last month. Several Asian markets have been shaken by the strong recovery in the dollar, to which Hong Kong and Taiwan currencies are linked, and the belief that US interest rates have reached their lowest levels. But Indonesia is the only market still standing at its lowest level of the year.
Emerging European markets have also risen strongly, led by Greece, Finland, and especially Turkey, where in spite of chronic inflation - or perhaps because of it - the share index has risen 80 per cent since the start of the year. Infant markets in eastern Europe are also taking forward steps, and Russia is a hot tip for the very brave who can also afford to wait.
Managers of more than 100 global emerging market equity funds that had pulled an estimated $170bn (pounds 110bn) net out of emerging markets in the first quarter of 1995, according to Micropal statistics, put around $1.2bn back in during the second quarter and have remained net investors since.
Most of this money, more than $900m net in the second quarter went into emerging Asian markets. Another $350m went into emerging African, Middle Eastern and European markets, and especially into South Africa, which has benefited from being reclassified as an emerging economy instead of a unique hybrid and has attracted a strong inflow of funds. Only Latin America continued to lose funds although the outflow dropped to under $100m in the second quarter.
In the last few months, Brazil has been the fund managers' favourite emerging market as measured by a Micropal poll, followed by Malaysia, Thailand, Mexico, South Korea, China/Hong Kong, South Africa and India. Mexico is certainly the cheapest emerging market, with average share prices below 10 times earnings.
Over the longer term, however, most analysts back Asian markets - on the grounds that they have the fastest and most consistent economic growth, the most competitive export industries as well as large home markets, and generallly conservative fiscal policies, with low inflation and small budget deficits, backed by high savings rates.
The most important thing for private investors to remember about emerging market funds is that they have been and will probably remain breath-takingly volatile, compared with funds invested in developed markets. Anyone tempted to invest in a single-country fund either has to be very brave or watch his or her investments like a hawk. For most investors, a global fund is a better bet, but still a bet.