Emerging equities slipped on Friday but were set for a fourth straight month of gains and currencies too have mostly strengthened in April, with the exception of the rouble which snapped a four-month winning streak.
A weaker dollar after U.S. President Donald Trump failed to push ahead on key election pledges in his first 100 days in office, some easing of geopolitical concerns and healthy data has whetted investors' appetite for riskier assets this month.
"April has been good for emerging markets, as well as the first quarter, and historically that is the case," Unicredit strategist Kiran Kowshik said, adding that May could prove more challenging.
"What could be the catalyst? Markets had priced out protectionism but there will be many curve balls," he said, referring to Trump's surprise announcement in a Reuters interview that he would fix or scrap his country's "horrible" trade deal with Asian export giant South Korea.
His comments weighed on South Korean and Chinese markets on the day, dragging MSCI's emerging markets benchmark 0.2 percent lower in their third day of losses. Yet thanks to previous stellar gains, the index is poised for a 1.6 percent weekly gain and 2 percent monthly rise.
The dollar nudging higher for a third straight session kept emerging currencies in check though many were on track for monthly gains.
Turkey's lira looked to strengthen nearly 2 percent against the dollar in April, extending a two-month winning streak.
Central Bank Governor Murat Cetinkaya said in his quarterly inflation presentation that he expected inflation to start falling in the coming months and policymakers would tighten monetary policy further if needed.
His comments contrasted with those from an aide to President Tayyip Erdogan saying that the president wanted to see a more "relaxed and generous central bank" and calling Wednesday's move to raise the late liquidity window unnecessary.
Meanwhile, latest data showed a 17 percent decline in tourism revenues in the first quarter, underscoring challenges to Turkey's economy.
South Africa's rand has gained nearly 1 percent in April despite a roller coaster ride following the acrimonious departure of its respected finance minister late-March.
In Russia, the rouble traded flat ahead of a central bank decision which is expected to see interest rates cut by 25 basis points amid easing inflation.
Over the month, however, the rouble looks to fall for the first month in five, having eased around 1.3 percent. Rabobank analysts predicted a 50 bps cut to 9.25 percent.
"Such a move would not only reflect rising confidence amongst policy makers that they will achieve their goal to bring inflation in line with the official 4 percent target, but we would also interpret a large cut as an attempt to dent demand for the rouble amongst carry trade market players," they wrote.
For 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
Emerging Markets Prices from Reuters Equities Latest Net Chg % Chg % Chg
on year
Morgan Stanley Emrg Mkt Indx 978.73 -0.93 -0.09 +13.51
Czech Rep 1003.61 +1.49 +0.15 +8.90
Poland 2391.00 +8.22 +0.34 +22.75
Hungary 32932.73 -26.89 -0.08 +2.90
Romania 8199.38 +14.61 +0.18 +15.73
Greece 706.99 +0.48 +0.07 +9.84
Russia 1116.40 +9.48 +0.86 -3.12
South Africa 47108.24 +123.79 +0.26 +7.30
Turkey 94223.02 -59.46 -0.06 +20.58
China 3154.57 +2.38 +0.08 +1.64
India 29957.36 -72.38 -0.24 +12.51
Currencies Latest Prev Local Local
close currency currency
% change % change
in 2017
Czech Rep 26.93 27.03 +0.38 +0.30
Poland 4.21 4.22 +0.16 +4.51
Hungary 311.29 311.36 +0.02 -0.79
Romania 4.53 4.53 -0.03 +0.07
Serbia 123.00 123.14 +0.11 +0.28
Russia 56.93 57.00 +0.12 +7.60
Kazakhstan 314.33 314.36 +0.01 +6.15
Ukraine 26.54 26.54 +0.00 +1.75
South Africa 13.30 13.34 +0.36 +3.27
Kenya 103.05 103.20 +0.15 -0.66
Israel 3.62 3.63 +0.37 +6.51
Turkey 3.56 3.56 +0.04 -0.90
China 6.90 6.90 -0.02 +0.67
India 64.18 64.10 -0.12 +5.87
Brazil 3.18 3.18 +0.03 +2.23
Mexico 19.02 19.02 -0.01 +8.92
Debt Index Strip Spd Chg %Rtn Index
Sov'gn Debt EMBIG 323 -2 .04 7 79.15 1
All data taken from Reuters at 08:48 GMT. Currency percent change calculated from the daily U.S. close at 2130 GMT.
For CENTRAL EUROPE market report, see
For TURKISH market report, see
For RUSSIAN market report, see)
(This article has not been edited by DNA's editorial team and is auto-generated from an agency feed.)
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