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Emerging-market stocks and currencies rise as Fed hike expectations ease
Developing-market stocks were up 0.7% and emerging-market currencies gained 0.2%, with a slide in the dollar driven by an unexpectedly weak US jobs report.
Emerging-market stocks and currencies climbed at the start of the week as expectations for additional Federal Reserve rate hikes eased after an unexpectedly weak US employment report, according to LiveMint Markets. A gauge of developing-market shares was up 0.7% and was on track to wipe out all of last week’s losses.
Emerging-market currencies rose 0.2% toward a fourth straight day of gains, led by Indonesia’s rupiah. Meanwhile, the Bloomberg Dollar Spot Index ticked higher after falling 0.4% on Friday to its lowest level in more than two months, with the strength of EM currencies attributed to the weaker US dollar.
Focus now shifts to US consumer price data later in the week, which is expected to be a key catalyst for the near term direction of the US dollar and, in turn, EM currencies. The article also noted that Monday’s gains came even as oil prices rose again, with Brent trading above $84 a barrel.
Among equity contributors, shares of Taiwan Semiconductor Manufacturing Co., Delta Electronics Inc., and SK Hynix Inc. were identified as top contributors to the MSCI emerging-markets stock gauge’s gains. In Indonesia, the stock benchmark was also on track to enter a technical bull market as sentiment improved on signs of a resilient economy and easing worries about potential market downgrades.
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