- Emerging Markets
[size=28]Emerging shares fall from highest since November as rally stallsBy Bloomberg / Bloomberg | July 19, 2016 : 12:22 PM MYT
JAKARTA (July 19): Emerging-market shares headed for their first decline in nine days, on speculation the securities were becoming too expensive after climbing to the highest since November.
Stocks in China, South Korea and Vietnam led losses as concern revived that Britain’s exit from the European Union, an economic slowdown in China and political unrest in Turkey will curb global growth. Most developing-nation currencies weakened against the dollar, paced by the Malaysian ringgit, Philippine peso and Korean won.
“The rally in emerging-market equities has been overdone and investors are starting to look at the reality on the risk of economic conditions in China and the financial industries in Europe,” said Jeffrosenberg Tan, an associate director at PT Sinarmas Sekuritas in Jakarta. “Countries like Indonesia, India and Philippine should perform better due to their dependencies on domestic growth.”
The MSCI Emerging Markets Index of equities slid 0.2% to 868.81 as of 10:56 a.m. in Hong Kong, after rising 6.2% in the previous eight sessions. The gauge climbed to 871.38 on Monday, the highest level since Nov 4. Benchmark indexes fell 0.4% in China, 0.4% in Korea and 0.1% in Vietnam.
The MSCI Emerging Markets Currency Index was little changed, having retreated 0.4% from an 11-month high reached on July 14. The ringgit slipped 0.3% and the Philippine peso and Korean won both fell 0.2%.
The Turkish lira slid 0.2% to 2.9844 per dollar, approaching a six-month low set on July 15, when an attempted coup against President Recep Tayyip Erdogan saw the currency tumble 4.6%.
The JPMorgan Emerging Market Volatility Index, a gauge of price swings, climbed 0.2% after falling to the lowest since August 2015 on Monday.
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