Emerging Markets: Stocks fall for third day on China deflation fears, FX subdued

Rainforest Resources

11/05/2023 09:38

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      China stocks, yuan fall after weak CPI data
    

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      South Africa's rand hits fresh three-year low
    

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      Pakistan rupee slumps to record low amid protests
    

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      EM stocks, FX down 0.2%
    

  
    By Amruta Khandekar
       May 11 (Reuters) - Emerging market stocks fell for a
third session on Thursday as gloomy data from China stoked
concerns about deflation and the country's pace of recovery,
while currencies were also subdued against a firm dollar.
    The MSCI's index for emerging market stocks  .MSCIEF  was
down 0.2% at 0827 GMT, while currencies in the region
 .MIEM00000CUS  also logged similar declines. 
    Stocks in China  .CSI300  slipped 0.2%, while the yuan
 CNY=  hit its lowest level in two months against the dollar as
data showed China's consumer prices rose at the slowest pace in
more than two years in April, while factory gate deflation
deepened.
    The dollar  =USD  which had taken a hit after a U.S.
inflation report on Wednesday raised bets of a rate hike pause
by the Federal Reserve, found its footing following the release
of the Chinese data, which provided further evidence of the
country's weak post-pandemic recovery. 
    The South African rand  ZAR=  was under renewed selling
pressure on Thursday, hitting a fresh three-year low against the
dollar as sentiment towards the currency was dented by the worst
power cuts on record.
    "South Africa is moving into the colder winter months and
preparations are being made for an escalation of the
load-shedding schedule. This is having a dire effect on what is
already a fragile economy," said Shaun Murison, senior market
analyst at IG.
    Pakistan's rupee slumped to new record low of 296 against
the greenback, amid deadly street protests sparked by the arrest
of former Prime Minister Imran Khan and of some senior leaders
of his party.
     The Russian rouble  RUBUTSTN=MCX  was last at 75.45,
jumping to a seven-week high against the U.S. dollar in early
trading on Thursday.
    The Hungarian forint  EURHUF=  and the Polish zloty
 EURPLN=  slid from over one-year highs hit in the previous
session, down 0.4% and 0.3% respectively.
    Czech inflation slowed further in April to its lowest since
March 2022, data showed on Thursday, possibly taking pressure
off the country's central bank to hike rates.
    An International Monetary Fund (IMF) staff team is expected
to arrive in Sri Lanka on Thursday as the crisis-hit country
prepares for the first review of a loan programme in September.
    
For GRAPHIC on emerging market FX performance in 2023, see http://tmsnrt.rs/2egbfVh

For GRAPHIC on MSCI emerging index performance in 2023, see https://tmsnrt.rs/2OusNdX
    
    For TOP NEWS across emerging markets  urn:newsml:reuters.com:*:nTOPEMRG
    For CENTRAL EUROPE market report, see  CEE/ 
    For TURKISH market report, see  .IS 
    For RUSSIAN market report, see  RU/RUB 

 (Reporting by Amruta Khandekar;
Editing by Bernadette Baum)
 ((Amruta.Khandekar@thomsonreuters.com;))