Emerging-market stocks fell for a fifth week, its longest stretch of losses since 2008, after the Group of 20 nations warned the European debt crisis still threatens global growth.
The MSCI Emerging Markets Index (MXEF) slid 0.2 percent to 1,021.51 at the close in New York, with 313 companies advancing and 445 dropping. The gauge declined 0.5 percent this week. Information technology companies led decliners, with Asustek Computer Inc. (2357) sliding the most since November in Taipei today. Embraer SA (EMBR3), a Brazilian manufacturer of defense aircraft, fell the most in six weeks.
Finance chiefs from the G-20 met today in Washington to join the International Monetary Fund and the U.S. in pressing Europe to intensify efforts to calm turmoil as it spreads to Spain. It was announced that governments committed more than $430 billion to the IMF to help it protect the world economy against a deepening debt crisis in Europe.
“This is certainly the biggest threat out there to emerging-market growth right now,” John-Paul Smith, emerging markets strategist at Deutsche Bank AG, said in a phone interview from London.
The MSCI index has risen 11 percent this year, while the MSCI World Index (MXWO) of developed nations added 8.4 percent. The gauge of developing nations is valued at 10.6 times estimated profit, compared with the MSCI World’s multiple of 12.4 times.
Emerging-market equity funds posted an outflow of $712 million in the week ended April 18, Citigroup Inc.’s analysts led by Markus Rosgen wrote in a report today, citing data compiled by EPFR Global. The consecutive weekly outflows from Asia excluding Japan funds since early March have erased all the inflows in early 2012, they said.
Brazil’s Bovespa index fell 0.2 percent. Fibria Celulose SA (FIBR3), the world’s largest pulp producer, rose 2.3 percent. Embraer fell 2.2 percent after Goldman Sachs cut the company’s rating to neutral from buy.
Poland’s WIG 20 Index (WIG20) fell 0.5 percent, for its lowest close in three months. Bank Ochrony Srodowiska SA (BOS), the Polish state-owned bank that finances environmental projects, fell the most in two weeks after setting the share price in a sale below a previously given maximum.
Taiwan, South Korea
Taiwan’s Taiex Index (TWSE) slumped 1.5 percent to its lowest level since Jan. 30 after UBS cut the stock market to underweight. TPK Holdings Co. (3673), which supplied touch panels to previous iPhone models, slid 7 percent, its biggest decline since Nov. 10. Apple is using new touch technology for the new generation iPhone, hurting sales and earnings for TPK, KGI Securities Co. said in a report.
Russia’s Micex Index climbed 0.6 percent as OAO Surgutneftegas, Russia’s fourth-largest oil producer, rose 1.2 percent after saying it will probably increase its dividend payout.
South Africa’s main shares gauge rose 0.3 percent and pared earlier losses of 0.5 percent. Aspen Pharmacare Holdings Ltd. (APN), a Johannesburg-based drugmaker, advanced 5.9 percent after it said earnings will be boosted by the purchase of drug ranges from GlaxoSmithKline Plc.
China’s Shanghai Composite Index (SHCOMP) rose to 2,406.86, its highest close since March 19, extending the benchmark index’s gains to a third week, on speculation the government will take steps to bolster economic growth.
Chinese stocks are UBS AG’s “biggest overweight” position as the government eases monetary policy, and the economy avoids a deeper slowdown, the brokerage’s Asian equity strategists wrote in a report dated today.
The extra yield investors demand to own emerging-market debt over U.S. Treasuries declined five basis points, or 0.05 percentage point, to 353, according to JPMorgan Chase & Co.’s EMBI Global Index.