Emerging Markets: Stocks steady as oil eases, central banks on deck; Brazil in focus after Lula win

Alphabet

Today 11:17

Brazil's 2037 international bond falls 1.1 cents
Serbia's 2031 euro bond rises after Aleksandar Vucic concedes defeat to student-led protesters
Chinese yuan reaches a four-year peak
By Ragini Mathur
Oct 26 (Reuters) - Emerging markets were mostly steady on Monday as investors weighed lower oil prices and an upcoming run of central bank decisions, while Brazilian assets were expected to face pressure after President Luiz Inácio Lula da Silva secured a fourth term. 
Brazil's electoral court declared Lula the winner on Sunday in a surprise result that defied polls, precedent and a broader global anti-incumbent trend, halting a run of right-wing victories across Latin America.
While local markets were yet to open, US-listed Brazilian shares fell in premarket trading. The iShares MSCI Brazil ETF EWZ.P plunged nearly 27%.
"We expect to see a selloff in the currency, equities and bonds when trading begins later today," said William Jackson, chief emerging markets economist at Capital Economics. "The moves are likely to more than reverse the rally seen after Flávio's strong showing in the first round."
Brazil's 2037 international bond fell 1.1 cents to 104.766 cents on the dollar, according to Tradeweb data on Monday. 
Elsewhere, Serbia's Aleksandar Vucic conceded defeat on Sunday to a student-led protest movement, ending the grip on power he had held since 2014. The country's euro-denominated 2031 bond RS336342538= rallied 0.7 cent. 
MSCI's benchmarks for emerging market stocks .MSCIEF and currencies .MIEM00000CUS were flat on the day.

INFLATION, CENTRAL BANKS IN FOCUS
Global investors were also awaiting a string of central bank decisions, with traders expecting the US Federal Reserve to keep rates unchanged on October 28. 
Oil prices, a key concern for policymakers, eased after climbing to near six-month highs last week on hopes that tensions between the US and Iran could cool. O/R
Still, currencies of net oil importers weakened, with India's rupee INR= down 0.3% and the Philippine peso PHP= off 0.5%, hitting a record low, while Indonesia's rupiah IDR= slipped past 18,100 per dollar. 
Worries over debt-funded AI spending and energy-driven inflation, after Houthi attacks in Saudi Arabia, weighed on risk appetite across emerging markets last week.
South Africa's rand ZAR= was flat, while stocks .JTOPI gained 1.3% ahead of economic data due this week. 
In central and eastern Europe, shares rose, and most currencies were steady against the euro, though the Hungarian forint EURHUF= fell 0.7%.
Hungary's new government last week set a budget deficit target of 4.9% of GDP next year and 2.8% by 2030 as it pursues euro adoption, though analysts said the plan offered limited detail on fiscal consolidation.
Turkish stocks .XU100 were subdued after sharp losses last week. The country approved legislation on the liquidation of frozen investment funds on Friday, though uncertainty remains over compensation for investors whose savings have been locked up for more than a month. The stocks had dropped more than 3% on October 16 after MSCI froze certain index changes.
In Asia, the Chinese yuan CNY=CFXS hit a fresh four-year high against the dollar, extending its longest winning streak since May as lower oil prices and softer US Treasury yields weighed on the greenback. Attention will also turn to China's fifth plenum for fresh policy clues.
South Korean shares .KS11 fell 1.5% ahead of earnings this week from chipmakers SK Hynix 000660.KS and Samsung Electronics 005930.KS. 
Investors were also looking to results from US technology giants Alphabet GOOGL.O and Microsoft MSFT.O for fresh signals on AI-related spending.

HIGHLIGHTS:

** Indonesia strengthens measures against stock manipulation after market rout triggered by MSCI
** Thai September exports rise 24% on year, above forecast

For TOP NEWS across emerging markets nTOPEMRG
For CENTRAL EUROPE market report, see CEE/

 (Reporting by Ragini Mathur in Bengaluru; Editing by Joyjeet Das)
 ((Ragini.Mathur@thomsonreuters.com;))