Stocks recover on China boost; investors mull Trump victory

Reuters

Stocks recover on China boost; investors mull Trump victory

2024 11월 7 일, 오전 9:34 GMT

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Updated at 0915 GMT

Czech, Serbia interest rate decisions on tap

MSCI adds five Indian stocks to key index

China's exports soar past forecast in October

MSCI EM stocks index up 0.6%, FX up 0.1%

By Johann M Cherian

Nov 7 (Reuters) -An index tracking equities in emerging markets rose on Thursday, lifted by a surge in Chinese stocks, while currencies took a breather from previous session's losses as investors weighed the implications of a second Donald Trump presidency in the U.S.

MSCI's emerging markets stocks index .MSCIEF was up 0.6%, recovering nearly all of Wednesday's losses as heavyweight China benchmarks .SSEC, .CSI300 rebounded and settled at their one-month highs. The indexes closed up 2.6% and 3%, respectively.

Traders were now focused on the National People's Congress Standing Committee meeting, which concludes on Friday. Any stimulus surprise from the meeting will likely help lift market sentiment in China stocks.

Also aiding gains was strong China export data for October.

Markets turned risk-off on Wednesday on expectations that a Trump presidency could mean heightened trade tensions with partners, inflationary pressures and a weaker global economy.

"I expect more positive numbers from China next month because companies who have imports from China are refilling their warehouses before the tariffs hike," said Vladimir Miklashevsky, an independent Finnish analyst.

"China will do its best to show that it is an open economy and that investors are welcome to mitigate this uncertainty, but this window is quite short at the moment."

An EM currencies gauge .MIEM00000CUS was flat after logging its biggest one-day drop in 20 months in the previous session.

Miklashevsky said that who will be part of Trump's administration is something EM investors will keep an eye out for in the near-term.

Traders were also awaiting a monetary policy decision by the U.S. Federal Reserve due later in the day.

In central and eastern Europe, Hungary's forint EURHUF= firmed 0.5%, although this was still close to near 2-year lows, and Poland's zloty EURPLN= edged up 0.4%.

A regional equities index .MIME00000PUS jumped about 2%, with Hungary's Budapest index .BUX trading at a record high.

Analysts expect Trump's tariff plans could hurt Europe's emerging east that is dependent on export demand, while higher U.S. interest rates could be a drag on economies with big budget deficits such as Poland, Hungary and Romania.

Poland's main stocks index .WIG gained 1.3%, with lender Pekao PEO.WA among top gainers with a 5.5% surge after posting upbeat quarterly net interest income.

The Czech koruna EURCZK= inched up 0.2% and Serbia's dinar EURRSD= was about flat ahead of their respective central bank interest rate decisions expected later in the day.

Elsewhere, Indian stocks .NSEI, .BSESN declined 1% each as earnings took center stage. Index provider MSCI added five Indian companies to its Global Standard Index, further narrowing the gap with China.

For GRAPHIC on emerging market FX performance in 2024 http://tmsnrt.rs/2egbfVh

For GRAPHIC on MSCI emerging index performance in 2024 https://tmsnrt.rs/2OusNdX

Reporting by Johann M Cherian in Bengaluru; editing by Mark Heinrich

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