By Karin Strohecker
LONDON, Nov 21 Emerging stocks and currencies
struggled higher on Monday as the post-U.S. election rise in the
dollar and U.S. yields lost some steam, though China's yuan and
Turkey's lira extended losses, the former approaching 8-1/2 year
Republican Donald Trump's unexpected election victory has
led to a major repricing of assets, with investors rushing to
snap up U.S. stocks and the dollar in anticipation of higher
infrastructure spending pushing up inflation. At the same time,
they have been dumping bonds and emerging markets.
Emerging stocks, which have lost 6 percent since
Trump secured the keys to the White House, rose 0.2 percent with
gains in Russia, South Africa and China
offsetting losses in India and Turkey.
Indian shares fell 1.8 percent as uncertainty grew
about the full impact of the government's recent demonetisation
Many currencies such as South Africa's rand, the
Mexican peso and Russia's rouble, strengthened
against the dollar, which pulled back from the
13-1/2-year peak it hit last week.
But China's yuan weakened to nearly an 8-1/2-year low
as the central bank set its daily guidance rate
weaker for a 12th straight session.
"The dollar index is at levels last seen in 2001, so it
doesn't surprise me (China) are letting the yuan weaken against
the dollar," said Per Hammarlund, chief emerging markets
strategist at SEB, adding there was a danger the weaker yuan
could prompt more outflows from China.
"If they let this go much further, it could spook the
Investors are preparing for more weakness. Dollar-yuan
non-deliverable forwards, a derivative used to
hedge against future exchange rate moves, are up 2 percent since
the start of the month and price the yuan just above 7 per
dollar in six months time versus the spot rate of around 6.89.
At a meeting of Pacific Rim leaders over the weekend,
Chinese officials said more countries were looking to join a
China-led trading bloc.
"China's comments at the APEC summit underpin the country's
apparent desire to take over any vacuum that a U.S. global trade
back-tracking would bring," said Simon Quijano-Evans, emerging
market strategist at Legal & General Investment Management.
"A tough one for Asian neighbours that have been positioning
themselves between China and the U.S."
In Turkey, the lira took another beating to weaken
0.3 percent, edging back towards the record low hit on Friday as
domestic woes exacerbate a tense macro-economic backdrop.
This week the governing AKP party will meet with the
nationalist opposition MHP to discuss plans to hand President
Tayyip Erdogan more power, while the EU parliament debates
freezing Ankara's talks on joining the bloc .
A central bank meeting has markets divided on whether policy
makers could hike interest rates for the first time in almost
Meanwhile in Mexico, which has seen its assets in the
crosshairs thanks to Trump's tough anti-globalisation talk on
the campaign trail, the peso strengthened for the second
straight session, up 0.5 percent.
Data from Nigeria showed that the recession deepened in the
third quarter as the economy contracted 2.24 percent and oil
production also fell.
Africa's largest economy slid into recession for the first
time in 25 years in the second quarter, when a slump in crude
prices contributed to a 2.06-percent contraction in the economy.
Across central and eastern Europe, currencies firmed
slightly against the euro, but hovered near the multi-month lows
reached after Trump's win .
Emerging Markets Prices from Reuters
Equities Latest Net Chg % Chg % Chg
Emrg Mkt Indx 846.17 +1.64 +0.19 +6.55
Czech Rep 882.55 -1.86 -0.21 -7.71
Poland 1742.15 +16.41 +0.95 -6.29
Hungary 30107.44 -1.58 -0.01 +25.86
Romania 6844.50 +20.31 +0.30 -2.28
Greece 612.57 +0.64 +0.10 -2.97
Russia 1005.29 +14.52 +1.47 +32.79
South Africa 44237.65 +21.09 +0.05 -3.41
Turkey 75431.59 -207.37 -0.27 +5.16
China 3218.21 +25.35 +0.79 -9.07
India 25775.61 -374.63 -1.43 -1.31
Currencies Latest Prev Local Local
close currency currency
% change % change
Czech Rep 27.06 27.02 -0.17 -0.23
Poland 4.43 4.44 +0.12 -3.94
Hungary 309.00 308.64 -0.12 +1.83
Romania 4.51 4.51 +0.02 +0.20
Serbia 123.12 123.15 +0.02 -1.34
Russia 64.21 64.65 +0.69 +13.62
Kazakhstan 338.45 340.80 +0.69 +0.61
Ukraine 25.76 25.85 +0.35 -7.02
South Africa 14.23 14.47 +1.70 +8.67
Kenya 101.78 101.70 -0.08 +0.41
Israel 3.87 3.88 +0.28 +0.48
Turkey 3.37 3.37 +0.04 -13.53
China 6.90 6.89 -0.11 -5.85
India 68.14 68.18 +0.06 -2.85
Brazil 3.38 3.38 +0.15 +17.23
Mexico 20.46 20.63 +0.81 -16.08
Debt Index Strip Spd Chg %Rtn Index
Sov'gn Debt EMBIG 387 2 .02 7 27.97 1
All data taken from Reuters at 10:04 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 )
(Additional reporting by Claire Milhench; Editing by Mark