December 23, 2016 / 10:32 AM / 7 months ago

EMERGING MARKETS-EM stocks extend post-Trump slide to 7.5 percent

6 Min Read

* EM stocks index falls for 9th time in 11 sessions
    * China stocks hit 2-month low, sparks fly with U.S.
    * Currencies in Asia slide but lira, rand, peso nudge higher

    By Marc Jones
    LONDON, Dec 23 (Reuters) - Emerging market stocks fell for
the ninth time in 11 days on Friday, taking their drop since
Donald Trump's U.S. election win to 7.5 percent and leaving
investors facing an uncertain start to 2017.
    Festive cheer was in short supply with some of the same
worries that brought a torrid start to 2016 for EM assets
starting to resurface.
    Chinese stocks , which are heading for a 17
percent walloping for the year, most of which came in January,
fell to a two-month low, while the yuan limped
back towards an 8-1/2 year low. reut.rs/1WAiOSC 
    As was the case at the beginning of the year, EM currencies
are being forced to bow to the dollar as the prospect of
further U.S. rate hikes and a fiscal spending drive under Donald
Trump loom.
    South Africa's rand, Turkey's lira and
Mexico's peso took advantage of the quiet pre-Christmas
market to nudge higher. So did Poland's zloty and
Hungary's forint after they had both hit more than
14-year lows versus the greenback on Thursday.
    But Asia continued to struggle. 
    The South Korean won hit a fresh 9-month low at 1,204.5
 per dollar, the Taiwan dollar touched its
lowest in nearly five months and Singapore's central bank was
suspected to have intervened to prop up its dollar 
after it fell to a more than six-year low..
    "We have almost come full circle on the dollar attitude,"
said UBP's EM macro and FX strategist Koon Chow. 
    "Similar to a year ago, we are expecting more U.S. rate
increases and also similar to a year ago we are seeing renminbi
(yuan) depreciation pressure due to outflows and arguably that
could intensify next year."
    One of the reasons could be lower demand for yuan to buy
property as Beijing bids to cool the overheating parts of the
country's housing market.
    Another is uncertainty about how China's relations with the
United States will fare under Donald Trump.
    Chinese state media on Friday expressed alarm and warned of
a "showdown" after the president-elect named Peter Navarro, an
economist who has urged a hard line against Beijing, to head a
new White House National Trade Council.
    "The new administration should bear in mind that with
economic and trade ties between the world's two largest
economies now the closest they have ever been, any move to
damage the win-win relationship will only result in a loss for
both sides," the official English-language China Daily said in
an editorial.
     

     Emerging Markets Prices from Reuters            
 Equities                  Latest    Net Chg  % Chg  % Chg      
     
                                                     on year    
       
 Morgan Stanley               
 Emrg Mkt Indx    840.95    -1.56   -0.19   +5.89     
       
 Czech Rep            919.76    +2.23   +0.24   -3.82     
       
 Poland           1933.50   -10.23   -0.53   +4.00     
       
 Hungary           31653.38   -47.47   -0.15  +32.33     
       
 Romania           7014.22    -7.69   -0.11   +0.14     
       
 Greece              624.96    -6.89   -1.09   -1.01     
       
 Russia            1126.03    +0.23   +0.02  +48.74     
       
 South Africa    42833.75  -450.36   -1.04   -6.47     
       
 Turkey          77201.88  -202.85   -0.26   +7.63     
       
 China             3110.00   -29.55   -0.94  -12.13     
       
 India           26033.92   +54.32   +0.21   -0.32     
       
            
 Currencies              Latest    Prev    Local    Local       
      
                                   close   currency currency    
       
                                           % change % change    
       
                                                    in 2016     
      
 Czech Rep      27.01     27.02   +0.02    -0.06      
     
 Poland          4.41      4.41   -0.03    -3.49      
     
 Hungary       310.03    310.24   +0.07    +1.49      
     
 Romania         4.53      4.52   -0.16    -0.26      
     
 Serbia        123.46    123.50   +0.03    -1.61      
     
 Russia            61.00     60.93   -0.11   +19.59      
     
 Kazakhstan       331.15    333.50   +0.71    +2.82      
     
 Ukraine           26.27     26.15   -0.46    -8.82      
     
 South Africa      13.98     14.03   +0.36   +10.60      
     
 Kenya            102.20    102.30   +0.10    +0.00      
     
 Israel             3.83      3.81   -0.49    +1.49      
     
 Turkey             3.51      3.51   -0.01   -16.91      
     
 China              6.95      6.95   -0.01    -6.56      
     
 India             67.77     67.84   +0.10    -2.32      
     
 Brazil             3.29      3.29   +0.00   +20.47      
     
 Mexico            20.73     20.75   +0.12   -17.16      
     
            
 Debt                 Index   Strip Spd  Chg   %Rtn   Index     
       
 Sov'gn Debt  EMBIG   362        -1    .01  7 35.58 1   
        
            
 All data taken from Reuters at 09:59 GMT.            
 Currency percent change calculated from the daily U.S.         
  
 close at 2130 GMT.            
    
For GRAPHIC on emerging market FX performance 2016, see tmsnrt.rs/2e7eoml

For GRAPHIC on MSCI emerging index performance 2016, see tmsnrt.rs/2dZbdP5
    
    For CENTRAL EUROPE market report, see 
    For TURKISH market report, see 
    For RUSSIAN market report, see )

 (Editing by Andrew Roche)

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