Investor appetite for emerging-market assets suffered as trade wars and concerns about global growth stoked a general market rout, say analysts.

Emerging-markets experienced $7.3 billion in portfolio outflows since the beginning of October, after flows were positive in September, the Institute of International Finance said in an Oct. 10 report. That level of retrenchment was last seen in June, when the U.S.-China trade talks intensified, prompting portfolio outflows from China, the IIF added.

This reversal is taking place against a backdrop of market turmoil. The S&P 500 Index fell 3.29% on Oct. 10 in what became a five-day losing streak, while European and Asian stock markets finished in the red. There was little improvement thereafter, with the S&P closed down about 2% on Oct. 11.

Meanwhile, the yield on the 10-year Treasury hit a new 52-week high of 3.263 on Oct. 9.

"The biggest connection between China and the rest of the world right now is trade," said Emre Tiftik, deputy director of the IIF's global capital markets department, in an interview.

"As global trade tensions mount, the outlook for China remains key given that a growth slowdown would reverberate across emerging markets," the IIF said in its report. "While flows to China have been resilient this year, foreign portfolio inflows slumped to $7 billion in September from over $30 billion in August."

"At the same time, higher interest rates in the U.S. are attractive," Tiftik noted. "Europeans especially are shifting to the U.S. from emerging markets."

During the week of Oct. 8, the International Monetary Fund cut its global growth projections and said that one of the biggest threats to sustained global growth was escalating trade tensions.

"The IMF release this week is a wake-up call; I would expect a net migration out of U.S. stocks to safe havens like Treasurys," said Kristina Hooper, global market strategist at Invesco, in an interview Oct. 11.

Still, correlations between different assets are not as high as they might be if there were true contagion between emerging and advanced economies, said Arnim Holzer, a portfolio manager at EAB Investment Group.

But with the Federal Reserve pursuing monetary policy normalization, there is likely to be more volatility, especially in riskier assets such as those in emerging markets, until neutral interest rates are attained, Holzer said.

"We're just not there yet, and we may not be there for another three to six months," Holzer said.