Katie Self, a portfolio manager at Pictet Asset Management and co-manager of its $5.1 billion Global Environmental Opportunities Fund, said no part of global asset markets would be fully insulated from the current El Niño cycle. She said it was virtually certain to be the most extreme on record.

According to Sina Finance, citing Bloomberg News, some boutique hedge funds are building broader investment theses around the climate cycle as El Niño intensifies.

El Niño-related droughts and floods are damaging crops, while food commodity prices are rising and economists are revising inflation and deficit forecasts. These effects are filtering into markets already contending with high debt and rising borrowing costs.

Man Group warned in July that the effects could hit power-grid infrastructure, metals and fertilizers. T. Rowe Price said it had adopted customized models to protect its $165 billion emerging-market bond and equity portfolio.

Anthropocene Fixed Income Institute analysts Kamesh Korangi and Rose Choy wrote this week that interest rates, debt and volatility are higher than in previous El Niño phases. They named Indonesia, Brazil and Colombia as the most vulnerable countries and said the effects could spill over globally.