It is rightly said that the ways of Mr. Market are mysterious as Dow chose to hit new life-time highs even in the midst of geopolitical tensions, whereas its peers among the developed economies are 3-4 percent away from registering new lifetime highs as on Thursday’s closing prices.

However, in the emerging market space, especially among the BRIC Nations, Indian equities are just at a kissing distance away from hitting new life highs and looks ripe for a correction, whereas Brazilian Bovespa appears to be on the cusp of a new bull run as it has just broken out of its 2008 highs and is sitting one percent above the breakout point of 73,920.

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Shanghai Composite, which is almost 45 percent down from 2007 highs of 6,124, remained as an underperformer but for the last couple of quarters appears to be positioning itself for a fresh leg of upmove as it has been in consolidation mode for the last five quarters.

Hence, some of the emerging market flows may get diverted into China and especially Brazil if it witnesses a sustainable breakout above 73,920 levels.