LONDON, Nov 17 (Reuters) - Earnings-driven gains on Wall Street pushed emerging stock markets higher on Friday, with Indian assets racing ahead following a ratings upgrade.
MSCI's emerging markets index rose 0.6 percent thanks to solid gains in major Asian bourses with Taiwan up 0.7 percent and Hong Kong nearly matching that as tech heavyweight Tencent Holdings jumped almost 3 percent. Bourses in South Africa, Russia and central Europe also edged higher.
"We have taken a very constructive view on the emerging markets space. It's a structural pull," said Pascal Blanque, chief investment officer at Amundi.
"We are seeing an improvement in macro, but what's new is ...significant improvements at the micro level, typically the quality of earnings which are moving into positive territory."
Indian markets posted some of the day's biggest gains, with stocks racing 1 percent higher and the rupee strengthening 0.6 percent against the dollar after Moody's upgraded the country's sovereign bond rating for the first time in nearly 14 years.
Moody's lifted India's rating to 'Baa2' from 'Baa3' while changing its outlook to 'stable' from 'positive', saying continued progress on economic and institutional reform would boost growth potential.
Moody's also raised the ratings of top Indian lender State Bank of India and HDFC Bank as well as some state-run energy firms , potentially lowering their borrowing costs.
"While the timing of the upgrade came as a positive surprise and has resulted in some spread tightening, we view valuations of Indian credit, both financials and corporates, as already quite expensive and would not chase on the back of the upgrade," Nicholas Yap at Nomura International wrote in a note to clients.
The picture looked less rosy for other emerging currencies, despite the dollar index slipping on reports that U.S. Special Counsel Robert Mueller's team had issued a subpoena for documents related to Russia from President Donald Trump's election campaign.
Turkey's lira chalked up some of the biggest losses, weakening 0.8 percent and on track for a similar fall since Monday, having weakened in nine of the past 10 weeks.
The falls came as President Tayyip Erdogan again took aim at the country's central bank, saying a lack of government intervention in monetary policy had left Turkey saddled with high inflation and facing a potential slowdown in investment.
South Africa's rand slipped 0.4 percent, but was on track for a more than 1 percent gain since Monday, snapping a four-week losing streak.
Russia's rouble was treading water thanks to support from end-of-month tax payments, but looked set for its fifth straight week in the red.
The International Swaps and Derivatives Association (ISDA) late on Thursday unanimously decided that Venezuela's delay to payments constituted a "credit event", triggering a payout on credit default swaps.
But investors said they did not expect a significant market reaction, given that Venezuela was making efforts to pay, and that holders of some of the world's highest yielding debt had so far been tolerant of the delays.
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Emerging Markets Prices from Reuters Equities Latest Net Chg % Chg % Chg
Morgan Stanley Emrg Mkt Indx 1132.62 +7.26 +0.65 +31.35
Czech Rep 1054.75 +1.87 +0.18 +14.45
Poland 2432.36 +21.25 +0.88 +24.87
Hungary 39206.45 +224.15 +0.58 +22.51
Romania 7742.38 +26.12 +0.34 +9.28
Greece 704.14 +2.78 +0.40 +9.40
Russia 1127.40 +0.88 +0.08 -2.16
South Africa 53709.07 +330.41 +0.62 +22.34
Turkey 06237.91 -738.76 -0.69 +35.96
China 3382.34 -16.91 -0.50 +8.98
India 33367.83 +261.01 +0.79 +25.32
Currencies Latest Prev Local Local
close currency currency
% change % change
Czech Rep 25.56 25.56 -0.02 +5.65
Poland 4.24 4.24 -0.08 +3.86
Hungary 312.19 311.79 -0.13 -1.08
Romania 4.64 4.64 -0.01 -2.18
Serbia 118.36 118.29 -0.06 +4.22
Russia 59.64 59.67 +0.05 +2.72
Kazakhstan 331.96 332.26 +0.09 +0.51
Ukraine 26.48 26.47 -0.04 +1.96
South Africa 14.20 14.14 -0.41 -3.30
Kenya 103.52 103.70 +0.17 -1.11
Israel 3.52 3.52 -0.09 +9.44
Turkey 3.89 3.86 -0.59 -9.22
China 6.63 6.63 -0.10 +4.66
India 65.00 65.29 +0.45 +4.53
Brazil 3.27 3.27 -0.00 -0.63
Mexico 19.08 19.06 -0.14 +8.55
Debt Index Strip Spd Chg %Rtn Index
Sov'gn Debt EMBIG 321 1 .02 7 98.77 1
Reporting by Karin Strohecker; graphic by Claire Milhench; editing by John Stonestreet