EM assets rise but set for weekly losses; China stimulus bets in focus

Reuters

EM assets rise but set for weekly losses; China stimulus bets in focus

8:49 sáng giờ GMT, 11 Tháng 10 2024

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Updated at 0830 GMT

Turkish end-2024 CPI seen at 44.11% - cenbank survey

Romanian inflation slightly above forecast in Sept

Hungary's economy to get boost from housing next year - PM Orban

Stocks up 0.3%, FX adds 0.1%

By Shubham Batra

Oct 11 (Reuters) -Emerging market stocks and currencies rose on Friday after U.S. economic data kept monetary easing bets intact in the world's largest economy, while the focus shifted to China's expected stimulus measures from its finance ministry.

MSCI's index of emerging market equities .MSCIEF edged 0.3% higher on the day but was set to record weekly losses of around 1.7%.

Eight of the top ten constituents, which hold one-fourth of the index, were higher, led by nearly 2.5% gains in Taiwan Semiconductors 2330.TW.

Markets priced in upcoming interest rate cuts by the U.S. Federal Reserve after data showed U.S. inflation was broadly on a downward trend, even though prices ticked up more than expected in September.

"The Fed has been a source of volatility for local assets, as tends to be the case when a central bank takes a data-dependent approach. That said, while markets repriced a slower pace and higher terminal after NFP, the overall messaging seems to be consistent," said strategists at Barclays in a note.

According to Barclays, EM stocks saw record inflows in the week to Wednesday, led by Chinese equities that saw $39 billion of inflows. Of this, inflows worth $30 billion were from domestic investors while foreign investors accounted for inflows worth $9 billion.

China stocks, however, closed the week in negative territory as investors' previous enthusiasm about economic stimulus gave way to concerns about whether the policy support would be big enough to revive growth.

The focus will now move to China's finance ministry, which is expected to announce a set of stimulus measures to revive the ailing economy on Saturday.

MSCI's gauge of EM currencies .MIEM00000CUS inched up 0.1% against a subdued dollar =USD, which was off its two-month highs.

Turkish lira TRY= weakened to 34.2950 against the U.S. dollar from Thursday's close of 34.1850 as the country raised its year-end inflation forecast to 44.11% from an earlier estimate of 43.14%.

In central and eastern Europe, the Hungarian forint EURHUF= slipped 0.1% against the euro, while the Polish zloty EURPLN= advanced 0.2%.

Prime Minister Viktor Orban told public radio that Hungary's economic growth will accelerate substantially in the first half of next year due to an expected housing boom backed by government measures.

Romanian leu EURRON= rose 0.1% against the euro as Romania's consumer price inflation fell to 4.62% on the year in September from 5.10% in the previous month, slightly above expectations.

Elsewhere in emerging markets, the Indian rupee INR=IN dropped to a lifetime low against the U.S. dollar on Friday, pressured by concerns over the recent jump in oil prices and the exodus of foreign money from the nation's equity markets.

For GRAPHIC on emerging market FX performance in 2024 http://tmsnrt.rs/2egbfVh

For GRAPHIC on MSCI emerging index performance in 2024 https://tmsnrt.rs/2OusNdX

Reporting by Shubham Batra in Bengaluru; Editing by Janane Venkatraman

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