BackEmerging stocks fall most in five weeks on China, Turkey data
The developing-nation gauge has gained 7.2% this year and is valued at 11.2 times projected 12-month earnings
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Bangkok: Emerging-market stocks fell the most in five weeks after Chinese Premier Li Keqiang signaled money-supply growth is slowing and Turkey’s economic expansion trailed estimates. The lira weakened to a five-month low.
PetroChina Co. led Hong Kong-traded Chinese shares to the steepest drop since February. Turkey’s equity gauge sank 1.3% and the lira slid 0.7% versus the dollar. Taiwan Semiconductor Manufacturing Co. paced declines for Apple Inc. suppliers after the US company unveiled new devices. South Africa’s rand and Russia’s ruble lost at least 0.4%.
The MSCI Emerging Markets Index fell 1.2% to 1,074.49 at 9:05 am in London, its fifth day of losses. China’s money-supply growth in August unexpectedly eased, comments by Premier Li indicated, while Turkey’s economy grew at its slowest pace in more than a year in the second quarter. BlackRock Inc. said an improving US labour market and signs of inflation argue for the Federal Reserve to raise interest rates.
“Optimism that Chinese demand will help drive developing countries’ economic growth would be misplaced," Sasikorn Charoensuwan, the head of research at Phillip Securities (Thailand) Pcl, said by phone in Bangkok. “The concern about a rise in US rates will continue to hang over emerging markets through next year."
The developing-nation gauge has gained 7.2% this year and is valued at 11.2 times projected 12-month earnings, data compiled by Bloomberg show. The MSCI World Index has risen 4.3% and trades at a multiple of 15.
China shares
The Hang Seng China Enterprises Index of mainland shares traded in Hong Kong slid 2.6%. PetroChina, the nation’s largest oil company, fell 3.5%. The Shanghai Composite Index lost 0.4 % as developers such as China Vanke Co. and Poly Real Estate Group Co. declined more than 1%.
M2, the government’s broadest measure, rose 12.8% in August from a year earlier, Li said on Tuesday in Tianjin, the state-run Xinhua News Agency reported ahead of the official release by the People’s Bank of China. That compares with a 13.5% pace in July, which was also the median estimate for August in a Bloomberg News survey of analysts.
China may report as early as Wednesday new credit data for the month of August. Figures on inflation, retail sales and industrial output are also due this week.
Turkish growth
Turkey’s Borsa Istanbul 100 Index headed for a two-week low and the lira was poised to close at the lowest level since 25 March. The nation’s gross domestic product grew 2.1% in the April-to-June period, missing the 2.8% median estimate in a Bloomberg survey of 15 analysts. Output unexpectedly fell 0.5% from the first quarter.
The Micex Index lost 0.1%. European Union governments meet on Wednesday to consider pulling the trigger on tougher Russian sanctions as the bloc weighs the viability of President Vladimir Putin’s truce in Ukraine.
The talks in Brussels among the 28 member nations follow the EU’s abrupt decision this week to put on hold for at least a “few days" a second package of economic penalties against Russia over its encroachment in Ukraine.
All 10 industry groups in the emerging-markets measure dropped, led by energy and technology companies. Taiwan’s Taiex Index slid 0.8% to a two-week low. Taiwan Semiconductor dropped 1.6% and Hon Hai Precision Industry Co., an assembler of Apple products, retreated 1%.
Apple fell 0.4% in New York on Tuesday. The company announced a smartwatch, mobile-payments system, health applications and bigger-screen iPhones. The shares, up 22% this year, have typically fallen after other events where its products debuted.
Dubai’s equity gauge lost 1.6% as Arabtec Holding Co. slid 2.7%. The Jakarta Composite Index dropped 1.1% while India’s S&P BSE Sensex retreated 0.7%. The rand sank for a third day, while India’s rupee, the Philippine peso and Malaysia’s ringgit fell at least 0.4%. BLOOMBERG
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