Emerging markets fell very sharply in October as global equity markets slumped on rising concerns about a severe economic slowdown. Latin America underperformed again as commodity prices declined. At a sector level, Energy and Materials underperformed on very weak commodity prices, while Information Technology was a relative outperformer.Performance was positively impacted by Samsung Electronics (South Korea: Information Technology) as investors anticipated it is likely to become stronger in the downturn. On the negative side, Brazilian sugar company Cosan was impacted by falling agricultural commodity prices. Over the month we bought Wal-Mart de Mexico, the leading Mexican retailer, which has an exceptionally strong franchise with good quality management. We sold Sime Darby (Malaysia) to consolidate our plantation holdings.Many emerging market banks have simply not been allowed to lend rashly and may drop to attractive valuation levels in coming months. The best run companies usually come out of a downturn stronger as competitors fall by the wayside.