Emerging Markets Fall 4th Day, Lira Slides on Ambassador Attack

  • Turkey’s currency falls after Russian ambassador fatally shot
  • Commodity producers, technology shares lead declines

Emerging-market stocks posted their longest streak of losses in five weeks as a drop in metals prices weighed on materials producers. Turkey’s lira led developing-nation losses after Russia’s ambassador to the nation was assassinated.

The MSCI Emerging Markets Index fell 0.6 percent for a fourth day of declines, extending its retreat since the U.S. presidential election on Nov. 8 to more than 5 percent. Technology shares dropped amid concern U.S. President-Elect Donald Trump will try to take jobs back to America and China’s efforts to curb speculation may slow growth. A similar gauge of currencies has fallen 2.9 percent during the period and is poised for a third month of declines.

  • Turkey’s lira fell 0.7 percent; this “only adds to concerns” for the currency, Andy Soper, head of G-10 options trading at Nomura, says in interview from London
  • Materials shares dropped 1.2 percent as a group, following a 4.5 percent slide last week
  • Brazilian real and Argentine peso led emerging markets gains; the real may continue to trade sideways as political headlines diminish, strategist Davison Santana writes
  • The ringgit is down 7.7 percent so far this quarter, the worst performer among emerging Asian peers, after a crackdown on currency speculators last month exacerbated outflows. It was little changed at 4.4785 per dollar.
  • Taiwan’s Taiex Index fell to a five-week low. The country’s high-end electronics companies may be hurt if Trump pushes tech industry to move jobs back to U.S., Beyond Asset President Michael On says in interview from Taipei.

Is the U.S. Dollar Overvalued?

“The long dollar trade is long in the tooth,” Rainer Michael Preiss, the executive director for client investments at Taurus Wealth Advisors Pte., a wealth management firm in Singapore, said in an interview with Bloomberg TV. “The first quarter of 2017 marks the eighth year of the bull market, and potentially would indicate that maybe we’re long in the rally.”

— With assistance by Ben Bartenstein

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