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Emerging-Market Stocks Retreat as Apple Outlook Saps Tech Shares

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Emerging-market stocks fell, led by technology companies, as Apple Inc.’s lower-than-forecast iPhone shipments and disappointing revenue forecast dragged down suppliers and Hong Kong-traded Chinese stocks slumped.

Hon Hai Precision Industry Co., which makes iPhones for Apple, slid 1.6 percent in Taipei. Hong Kong’s Hang Seng China Enterprises Index sank to a one-week low. Naspers Ltd. led declines in South Africa. The Ibovespa fell for a fourth day as concern mounted that Brazil’s credit rating will be cut. Turkey’s lira slid 0.8 percent against the dollar after two police officers were killed in an attack along the Syrian border.

The MSCI Emerging Markets Index declined 0.9 percent to 931.14. China’s H-share gauge has fallen almost 10 percent in July, the worst among 93 global benchmarks tracked by Bloomberg, amid worries slowing economic growth will hurt earnings and state intervention in equities will delay market reforms. Apple slid 5 percent in U.S. trading.

Investors are “concerned about a slowdown in iPhone shipment growth and, by extension, the wider smartphone market and supply chain,” Tony Hann, the head of emerging markets at Blackfriars Asset Management Ltd. in London, said by e-mail. “More broadly, the Chinese economy and ramifications for the global economy, especially commodities” are also a worry, he said.

Oil Drop

Brent crude resumed declines, falling 1.6 percent to $56.13. Sasol Ltd. lost 1.8 percent in Johannesburg. The dollar-denominated RTS Index of Russian stocks slid 0.4 percent. The ruble weakened 0.9 percent against the dollar.

The Ibovespa slumped 1.1 percent to the lowest level since late March and the real weakened 1.7 percent. Brazilian assets dropped as Folha de S. Paulo reported that President Dilma Rousseff decided to lower this year’s budget surplus target, stoking concern that she is wavering in her commitment to maintaining the nation’s credit rating.

Poland’s WIG20 Index retreated 2.8 percent, as copper producer KGHM Polska Miedz SA slumped 8.8 percent to the lowest in five years. A Bloomberg gauge of commodity prices fell 1.8 percent.

Stocks in India, a net oil importer, jumped 1.2 percent led by a 4.3 percent gain in Reliance Industries Ltd., ahead of the company’s first-quarter earnings report, due on July 24.

The Borsa Istanbul 100 Index dropped 0.4 percent. The deaths of the two policemen in Turkey follow Monday’s suspected suicide bombing, which killed 32 people in the town of Suruc.

The victims were mostly Kurdish activists preparing to cross the border and help their Syrian allies, who earlier this year drove Islamic State from Kobani. Twitter Inc.’s website was inaccessible to many users in Turkey on Wednesday following a reporting ban on Monday’s attack.

Turkey Rates

Turkey’s central bank will meet tomorrow and may keep interest rates unchanged at 7.5 percent, according to the median estimate of 11 economists in a Bloomberg survey.

All 10 industry groups in the MSCI emerging stocks index slid, led by a 1.2 percent drop in technology shares. Hon Hai retreated for the first time in three days and Catcher Technology Co. fell 4.8 percent. Taiwan’s Compal Electronics Inc. and South Korea’s Samsung SDI Co. tumbled at least 6 percent.

The developing-nation stock index has fallen 2.6 percent this year and trades at 11.5 times projected 12-month earnings, data compiled by Bloomberg show. The MSCI World Index has risen 3.3 percent in 2015 and is valued at a multiple of 16.5.

The premium investors demand to own emerging-market bonds over U.S. Treasuries widened two basis points to 352 basis points, according to JPMorgan Chase & Co. indexes.

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