Emerging-market stocks touched a one-week high yesterday, tracking global equities higher, as Sino-US trade optimism grew after encouraging comments from US President Donald Trump.
With less than 10 days left before additional US tariffs are imposed on Chinese goods, markets are still hoping for a phase-one trade deal.
Trump on Thursday said trade talks are “moving right along,” even as Beijing maintained its stance that some existing tariffs must come off as part of an interim agreement.
“Although progress towards an interim agreement has taken on a Brexit-like tortuousness, at least both sides appear to be still talking,” Jeffrey Halley, a senior market analyst at OANDA, wrote in a note. “Trade headlines will continue to flip-flop sentiment in an already-volatile cocktail next week.” MSCI’s index of developing-world equities rose yesterday.
It was set to gain for the week, ending three straight weeks of declines.
Hopes for recovery in emerging markets has also driven some risk-on buying, with investors expecting to reap the benefits of lower global interest rates going into the next year.
Chinese stocks ended higher for the day and posted their best weekly gain in nearly two months.
South African equities rose as much as 1.1%. Russian shares gained, led by oil and gas stocks.
Gazprom PAO and Novatek PAO rose on stronger oil prices after Opec agreed to cut output by almost 50% in early 2020.
Emerging-market currencies continued to benefit from a weaker dollar, with MSCI’s developing world currencies index set to gain for the week.
The dollar was pressured through the week by weak economic readings.
It was lower yesterday before US payrolls data expected later in the day.
China’s yuan rose nearly 0.2% to the dollar, and was set to end two straight weeks of declines.
Most other emerging Asia currencies also strengthened slightly.
The South African rand edged up. The Hungarian forint and the Polish zloty slipped lower against the euro.
from Gulf Times https://ift.tt/2DQpqKQ
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