EMERGING MARKETS-Russian stocks lead emerging market falls with 2 pct slump

  • Reuters
  • Stock Market News
EMERGING MARKETS-Russian stocks lead emerging market falls with 2 pct slump
Credit: © Reuters.

By Sujata Rao

LONDON, June 15 (Reuters) - Russian stocks led losses on emerging markets on Thursday, hitting 15-month lows and heading for a third day of losses as risks grew of expanded U.S. sanctions and oil prices tumbled amid worries over U.S. and world economic growth.

MSCI's emerging equity index fell 0.8 percent .MSCIEF snapping a two-day winning streak as oil prices touched seven-month lows and a strong inventory build-up cast doubt on the strength of the global economy.

These fears were underscored by weak U.S. retail and inflation data, despite the U.S. Federal Reserve's decision to raise interest rates for the second time in three months and start unwinding its bond purchases. emerging market losses were led by Russia where stocks tumbled almost 2 percent .MCX , after U.S. lawmakers voted in favour of new sanctions punishing Russia for meddling in 2016 U.S. elections and making it harder to ease existing curbs. stocks are responding to the bill passed by the U.S. Senate last night which would tighten the sanctions regime if signed into law," William Jackson at Capital Economics said, noting also the relatively strong rouble which was weighing on exporters' shares.

"Early signs are that (the bill) won't have a very big macroeconomic impact, but ... as far as there were any hopes that sanctions might be eased or lifted gradually under the Trump administration, that is not going to happen."

The rouble hovered near one-month highs RUB= while Russian sovereign dollar bond yield premiums to U.S. Treasuries were flat at two-month highs 11EMQ .

Most other emerging assets retreated, with Hong Kong shares at a three-week low after local authorities followed the Fed in raising rates .HSI . Mainland Chinese shares also weakened .CSI300 .

Gulf central banks also hiked rates following the Fed move, pushing down most local bourses, though sanctions-hit Qatar is yet to do so. Qatari stocks were up slightly but on track for a fifth week of losses .QSI .

The Turkish lira TRY= pulled off six-month highs before a central bank meeting that should make no changes to the late liquidity lending rate used by the bank.

The lira has been gaining steadily against a weak dollar, therefore "defence of the currency is no longer a driving force," Commerzbank (DE: CBKG ) analysts wrote. They noted that while inflation remained close to 12 percent, "this argument is not sufficient to trigger a rate hike today".

In central Europe the Romanian leu tumbled to new 4-1/2-year lows to the euro EURRON= after the ruling Social Democrats withdrew support for the government led by prime minister Sorin Grindeanu. GRAPHIC on emerging market FX performance 2017, see http://tmsnrt.rs/2e7eoml For GRAPHIC on MSCI emerging index performance 2017, see http://tmsnrt.rs/2dZbdP5

For CENTRAL EUROPE market report, see CEE/

For TURKISH market report, see .IS

For RUSSIAN market report, see RU/RUB ) Emerging Markets Prices from Reuters

Equities

Latest

Net Chg % Chg % Chg

on year

Morgan Stanley (NYSE: MS )

Emrg Mkt Indx .MSCIEF 1005.29

-8.40 -0.83 +16.59

Czech Rep

.PX

999.06

-1.09 -0.11 +8.40

Poland

.WIG20

2295.99

-6.42 -0.28 +17.87

Hungary

.BUX

35746.25 -239.57 -0.67 +11.70

Romania

.BETI

8447.46 -29.66 -0.35 +19.23

Greece

.ATG

796.79

-4.18 -0.52 +23.79

Russia

.IRTS

982.63 -31.15 -3.07 -14.73

South Africa

.JTOPI 44620.32 -464.54 -1.03 +1.64

Turkey

.XU100 98613.92 -1022.35 -1.03 +26.20

China

.SSEC

3132.67

+1.99 +0.06 +0.94

India

.BSESN 31028.07 -127.84 -0.41 +16.53

Currencies

Latest

Prev

Local

Local

close currency currency

% change % change

in 2017

Czech Rep

EURCZK=

26.17

26.15 -0.07

+3.19

Poland

EURPLN=

4.20

4.20 -0.14

+4.80

Hungary

EURHUF= 306.57

305.60 -0.32

+0.73

Romania

EURRON=

4.58

4.57 -0.18

-1.04

Serbia

EURRSD= 122.11

122.20 +0.07

+1.02

Russia

RUB=

57.41

57.38 -0.06

+6.71

Kazakhstan

KZT=

317.85

316.48 -0.43

+4.97

Ukraine

UAH=

26.00

26.01 +0.02

+3.85

South Africa ZAR=

12.74

12.63 -0.91

+7.76

Kenya

KES=

103.35

103.35 -0.00

-0.95

#VALUE!

Turkey

TRY=

3.50

3.49 -0.43

+0.70

China

CNY=

6.80

6.79 -0.13

+2.14

#VALUE!

#VALUE!

#VALUE!

Debt

Index Strip Spd Chg %Rtn Index

Sov'gn Debt 11EML EMBIG 321

0

.01 7 92.07 1

All data taken from Reuters at 09:13 GMT.

Currency percent change calculated from the daily U.S.

close at 2130 GMT.

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