AI Boom Drives Record Gains in Emerging Markets as MSCI EM Index Surges

Artificial intelligence has emerged as the primary catalyst for growth in Emerging Markets, accounting for nearly half of the MSCI EM Index's total returns in 2025. According to recent data, seven of the top ten contributors to the index's performance were companies directly linked to the AI sector. The sector's influence was profound, contributing over 40% of the index's overall 34% return during the period. Major Asian enterprises, most notably TSMC, have solidified their roles as essential providers of the physical infrastructure required for global AI development. This structural shift highlights the increasing dependence of the global tech ecosystem on semiconductor manufacturing and hardware sourced from these markets. Consequently, the outlook for EM indices remains bullish as they transition into key hubs for AI-driven innovation.