EMERGING MARKETS-Emerging stocks extend gains on NAFTA deal; lira slides

  • Reuters
  • Stock Market News
EMERGING MARKETS-Emerging stocks extend gains on NAFTA deal; lira slides
Credit: © Reuters.

By Claire Milhench

LONDON, Aug 28 (Reuters) - Emerging-market stocks rose to 18-day highs on Tuesday, tracking gains on Wall Street after U.S.-Mexico trade agreement, but the lira fell after Turkey warned that U.S. sanctions against it could destabilise the Middle East.

The United States and Mexico agreed on Monday to overhaul the North American Free Trade Agreement, boosting auto stocks and lifting the S&P 500 .SPX and Nasdaq .IXIC to record highs benchmark emerging-market equities index .MSCIEF rose 0.3 percent after jumping 1.8 percent on Monday, its best one-day gain since the end of June.

The upbeat trade outlook was also boosted by news Washington was pushing the European Union to accelerate tariff talks fact that they are moving forward is a good sign," said Per Hammarlund, chief emerging markets strategist at SEB. "If (U.S. President Donald Trump) can agree with Mexico maybe he can agree with the EU, and China eventually too. It's good news for markets."

Asian and emerging European markets made broad-based gains with India .NSEI up 0.5 percent to an all-time high Turkey .XU100 up 0.8 percent, and Hong Kong .HSI 0.3 percent. Poland .WIG20 hit a six-month high before retreating.

Mexico's peso .MXN weakened 0.2 percent after bouncing around 0.7 percent on Monday following the deal.

China's yuan hovered CNY= near two-and-a-half-week highs after the central bank raised its daily guidance rate for the yuan by the most in nearly 15 months Monday, the central bank revived a "counter-cyclical" factor in its daily fixing arresting a 10-week slide in the yuan that had rattled global markets said this had helped risk appetite because it was taken as a sign that China would not weaken the renminbi as a weapon in the trade war with the United States.

Chinese mainland shares .CSI300 retreated 0.2 percent, after leaping 2.4 percent in the previous session.

Turkey's lira TRY= again weakened the most among the currencies, down 1.3 percent after Finance Minister Berat Albayrak warned that U.S. trade sanctions against Turkey could destabilise the Middle East five-year credit default swaps rose 8 basis points from Monday's close to 484 bps according to IHS Markit data.

The rift with the U.S. over an pastor detained in Turkey on terrorism charges has aggravated a crisis in the Turkish lira this summer. Investors are concerned about structural problems including a failure to tighten monetary policy and constrain public finances.

The South African rand ZAR=D3 gained 0.1 percent after U.S. Federal Reserve chairman Jerome Powell's speech at Jackson Hole, which signalled steady interest rate hikes country has scrapped plans to add 9,600 MW of nuclear power by 2030 and will instead aim to add capacity in natural gas , wind and other energy sources rouble RUB= was steady after new U.S. sanctions came into effect on Monday. Russia has drawn up a range of measures in case the U.S. imposes sanctions on Russian sovereign debt GRAPHIC on emerging market FX performance 2018, see http://tmsnrt.rs/2e7eoml For GRAPHIC on MSCI emerging index performance 2018, see http://tmsnrt.rs/2dZbdP5

For TOP NEWS across emerging markets 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 1072.60

+3.46 +0.32 -7.41

Czech Rep

.PX

1079.21

+2.70 +0.25 +0.10

Poland

.WIG20

2362.73

-7.24 -0.31 -4.00

Hungary

.BUX

36730.95 +45.16 +0.12 -6.72

Romania

.BETI

8291.67

-9.61 -0.12 +6.94

Greece

.ATG

736.56

+0.29 +0.04 -8.20

Russia

.IRTS

1084.50

+0.37 +0.03 -6.06

South Africa

.JTOPI 53772.58 +217.97 +0.41 +2.36

Turkey

.XU100 91957.02 +672.97 +0.74 -20.27

China

.SSEC

2777.98

-2.92 -0.10 -16.00

India

.BSESN 38873.52 +179.41 +0.46 +14.14

Currencies

Latest

Prev

Local

Local

close currency currency

% change % change

in 2018

Czech Rep

EURCZK=

25.71

25.70 -0.05

-0.71

Poland

EURPLN=

4.27

4.27 -0.12

-2.31

Hungary

EURHUF= 324.08

323.70 -0.12

-4.18

Romania

EURRON=

4.64

4.64 +0.01

+0.73

Serbia

EURRSD= 118.39

118.10 -0.24

+0.01

Russia

RUB=

67.42

67.38 -0.05 -14.48

Kazakhstan

KZT=

361.47

360.82 -0.18

-7.93

Ukraine

UAH=

28.00

27.84 -0.57

+0.52

South Africa ZAR=

14.14

14.16 +0.13 -12.63

Kenya

KES=

100.60

100.75 +0.15

+2.49

Israel

ILS=

3.63

3.62 -0.09

-4.13

Turkey

TRY=

6.20

6.12 -1.22 -38.85

China

CNY=

6.81

6.81 +0.12

-4.41

India

INR=

70.24

70.16 -0.11

-9.12

Brazil

BRL=

4.08

4.08 -0.02 -18.79

Mexico

MXN=

18.78

18.76 -0.10

+4.64

Debt

Index Strip Spd Chg %Rtn Index

Sov'gn Debt 11EML EMBIG 386

1

.01 7 72.26 1

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