As July’s rallies evaporate, investors in emerging markets – and in some of the weaker economies in more developed markets – are being warned to exercise caution rather than count on further rapid gains.

Last month, the equity markets of Brazil, Poland and Turkey all rose more than 13 per cent, according to S&P Indices, while shares in Greece and Spain recovered 21 and 29 per cent respectively. However, the Brazilian, Spanish and Polish indices have each fallen at least 3 per cent since Monday, in line with the poor performance of UK and US markets.

Advisers say the scale of the sell-off confirms the view that emerging markets could well be hit as severely as more developed markets in the near term if volatility lingers and economic conditions worsen.