LONDON May 15 Emerging markets started the week
on a high on Monday, with stocks at a two-year peak, the
rouble, rand and lira up for a fourth straight session and hard
currency bonds at their strongest since late-2014.
The rally came thanks to an oil-led charge in commodity
markets, as well as weakness in the dollar after lacklustre
economic data on Friday had cooled what had been growing
expectations for a rapid-fire run of U.S. interest rate hikes.
Russia's rouble jumped almost one percent to under
56.5 per dollar as the Russian and Saudi energy ministers said
oil production cuts would be extended, catapulting Brent and WTI
Russian shares led the pack with a more than
1.2-percent rise after climbs across much of Asia had lifted
MSCI's 23-country EM index to its highest since May 2015
and put it on track for a sixth day of gains for the first time
"The news that there's been a consensus on extending the
OPEC cuts has provided some support to oil prices and some of
the oil currencies such as the rouble," said Capital Economics'
senior emerging markets economist William Jackson.
"Maybe that has spread through to a more general improvement
in sentiment towards emerging markets."
There was little impact, meanwhile, from
weaker-than-expected Chinese data, where factory output and
fixed asset investment growth cooled in April after a strong
The yuan edged marginally lower, but shares in
Shanghai ended up 0.4 percent, steadying after falling
almost 6 percent since early April.
Elsewhere Pakistan shares hit their latest record
high and South Korean stocks shrugged off a fresh
missile test in North Korea to finish 0.2 percent
higher and just below their all-time peak.
India's rupee also climbed 0.3 percent on news that
consumer inflation eased in April to its lowest in at least five
The country's improving inflation performance has pushed
real interest rates - the amount by which they exceed inflation
- strongly into positive territory. That has attracted buyers to
the bond market and driven stocks to double-digit percentage
gains this year. Ten-year yields slipped to one-month low.
Morgan Stanley investment flow data published on Monday
underscored the current fashion for emerging markets assets.
Dedicated EM funds that it tracks reported inflows of $2.32
billion over the last week, the eighth straight week of positive
momentum, its figures showed.
That included a 15th straight week of inflows for EM bond
funds. All EM countries reported equity inflows too with Greece,
Colombia and Qatar seeing the largest moves relative to the
funds' assets under management.
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 1008.35 +5.98 +0.60 +16.94
Czech Rep 1017.21 -0.75 -0.07 +10.37
Poland 2370.22 +1.72 +0.07 +21.68
Hungary 34323.72 -111.81 -0.32 +7.25
Romania 8426.48 +18.81 +0.22 +18.93
Greece 790.51 +1.38 +0.17 +22.82
Russia 1114.53 +14.78 +1.34 -3.28
South Africa 47446.50 +16.07 +0.03 +8.07
Turkey 95578.01 +581.66 +0.61 +22.32
China 3090.23 +6.72 +0.22 -0.43
India 30328.83 +140.68 +0.47 +13.90
Currencies Latest Prev Local Local
close currency currency
% change % change
Czech Rep 26.50 26.56 +0.20 +1.90
Poland 4.21 4.21 +0.07 +4.63
Hungary 309.50 309.50 +0.00 -0.22
Romania 4.55 4.54 -0.05 -0.26
Serbia 123.06 123.10 +0.03 +0.24
Russia 56.49 57.04 +0.98 +8.45
Kazakhstan 312.85 315.86 +0.96 +6.65
Ukraine 26.43 26.46 +0.11 +2.16
South Africa 13.26 13.35 +0.70 +3.56
Kenya 103.15 103.10 -0.05 -0.76
Israel 3.60 3.60 -0.07 +6.94
Turkey 3.56 3.57 +0.26 -1.02
China 6.90 6.90 +0.01 +0.68
India 64.12 64.24 +0.19 +5.97
Brazil 3.12 3.12 -0.04 +4.20
Mexico 18.71 18.81 +0.52 +10.72
Debt Index Strip Spd Chg %Rtn Index
Sov'gn Debt EMBIG 318 0 .02 7 81.77 1
(Additional reporting by Claire Milhench in London; Editing by