LONDON Feb 23 Emerging equities powered to
fresh 19-month highs on Thursday after U.S. Federal Reserve
minutes suggested the Fed would hold off a March rate hike,
while the South African rand briefly hit a one-week high after
MSCI's benchmark emerging stocks index rose 0.2
percent, with Indian shares up 0.5 percent to hit the
highest since March 2015, Turkish stocks up 0.7 percent
and Bucharest shares up 0.2 percent at a fresh nine-year
Hong Kong shares touched a new 5-1/2-month high,
reassured by a run of relatively robust Chinese data.
Emerging stocks have gained over 10 percent year-to-date,
helped by improving macroeconomic data in emerging and developed
markets, and higher commodity prices, which are helping
commodity exporters to reduce current account deficits.
"Global data is still looking quite strong and that bodes
well for EM as a whole," said Kiran Kowshik, an emerging markets
strategist at Unicredit. "Iron ore is still trading quite strong
- so long as the global economy is showing signs of recovery, we
really like the commodity exporter currencies."
Appetite for riskier assets was also supported by U.S.
Federal Reserve minutes indicating that uncertainty over
President Donald Trump's planned tax cuts and spending plans
would deter the Fed from raising rates in March.
Currencies made gains even in the face of a stronger dollar,
with the South African rand up 0.3 percent to briefly
touch a one-week high a day after a budget that targeted high
earners with a new tax to curb the deficit.
South African five-year credit default swaps also slipped 3
basis points (bps) from Wednesday's close to 192 bps, according
to Markit data, a one-week low.
"The budget went without any accident. Ratings agency S&P
said it seems to tick all the right boxes as of now. The market
is probably trying to price in that you won't get a June
downgrade. That was a big concern for the market and that's
coming off," Kowshik said.
Finance Minister Pravin Gordhan, who has been under pressure
to quit from some sections of the ruling party, said it was up
to President Jacob Zuma to fire him, but that his record spoke
The Turkish lira was steady at near 1-1/2-month highs
and the Russian rouble gained 0.2 percent, helped by a
1.5 percent rise in oil prices.
The South Korean won edged up after the Bank of Korea
kept rates unchanged at 1.25 percent, a record low, in the face
of declining consumer confidence and political turmoil.
Korean stocks were trading at their highest
level since July 2015.
But the Polish zloty slipped 0.25 percent against
the euro, underperforming its emerging European peers, after
Czech crown bond yields slipped, with five-year
yields touching one-week lows after JPMorgan said
Czech crown-denominated government bonds would join its GBI-EM
emerging markets benchmark at the end of April. The
move is likely to spur inflows from index-tracking funds.
Nigeria's naira steadied in the non-deliverable forwards
(NDF) market after Tuesday's sharp falls, amid confusion over
whether authorities would follow through on signals that the
currency could be devalued.
Six-month NDFs showed the naira trading at
around 379 per dollar, after blowing out to 397 per dollar on
Tuesday. The official rate is around 305.
For GRAPHIC on emerging market FX performance 2017, see tmsnrt.rs/2e7eoml
For GRAPHIC on MSCI emerging index performance 2017, see tmsnrt.rs/2dZbdP5
For CENTRAL EUROPE market report, see
For TURKISH market report, see
For RUSSIAN market report, see)
Emerging Markets Prices from Reuters
Equities Latest Net Chg % Chg % Chg
Emrg Mkt Indx 952.43 +1.48 +0.16 +10.46
Czech Rep 972.50 -0.22 -0.02 +5.52
Poland 2248.99 -2.03 -0.09 +15.46
Hungary 33795.22 -317.67 -0.93 +5.60
Romania 8042.52 +7.27 +0.09 +13.51
Greece 644.73 -2.41 -0.37 +0.17
Russia 1146.01 -15.64 -1.35 -0.55
South Africa 45045.49 -28.12 -0.06 +2.60
Turkey 89166.86 +635.58 +0.72 +14.11
China 3251.09 -10.13 -0.31 +4.75
India 28990.84 +126.13 +0.44 +8.88
Currencies Latest Prev Local Local
close currency currency
% change % change
Czech Rep 27.00 27.01 +0.04 +0.02
Poland 4.31 4.29 -0.25 +2.29
Hungary 307.84 307.62 -0.07 +0.32
Romania 4.52 4.51 -0.04 +0.43
Serbia 123.91 123.82 -0.07 -0.45
Russia 57.90 58.00 +0.18 +5.81
Kazakhstan 312.49 313.96 +0.47 +6.77
Ukraine 26.90 26.92 +0.07 +0.37
South Africa 12.97 12.97 -0.01 +5.89
Kenya 103.50 103.50 +0.00 -1.09
Israel 3.70 3.69 -0.20 +4.01
Turkey 3.58 3.58 -0.05 -1.52
China 6.88 6.88 +0.00 +0.97
India 66.81 66.89 +0.12 +1.70
Brazil 3.06 3.06 +0.00 +6.21
Mexico 19.94 19.90 -0.19 +3.90
Debt Index Strip Spd Chg %Rtn Index
Sov'gn Debt EMBIG 334 1 .03 7 62.27 1
(Editing by Gareth Jones)