|Day's range||77,005.4531 - 78,688.4688|
|52-week range||69,069.0000 - 88,318.0000|
Emerging-market stocks, currencies and bonds were unfazed by an escalation in the U.S.-China trade dispute, rising for a second week as the dollar retreated. The Chinese yuan had its first weekly gain this month as Premier Li Keqiang said the country won’t devalue its currency in order to make its exports more competitive amid trade tension with the U.S.
This was supposed to be Brazil’s breakout year. During the ensuing 12 months, $1.3 billion poured into Latin America’s largest economy through exchange traded funds, making it a top-10 nation among investors. The biggest of them, BlackRock’s MSCI Brazil ETF, suffered its worst outflows since inception in 2000.
Improving corporate results are propping Brazilian stocks up and helping ease the blow from election uncertainty that’s sent the currency near its lowest level ever. It’s a welcome change after years of falling profits as Brazil weathered the worst recession in history. Corporate earnings are expected to grow 32 percent in 2018 and 19 percent in 2019, according to Roberto Serwaczak, Citigroup’s head of Latin America equity.
Forget all the talk about an escalating trade war damaging the U.S. economy or that the coming midterm elections threaten to throw the political system into disarray. In fact, they are loading up on super-safe cash-like instruments as bets on the Federal Reserve raising interest rates two more times before year-end reach a new high. Demand at the U.S. Treasury's bill auctions this week were on the high side, especially for 52-week bills.
Brazilian markets dropped as a poll showed left-wing candidates gaining support while those favored by investors stalled out with less than a month to go until the presidential election. The real and the benchmark stock index were the worst performers among major markets globally Tuesday, erasing all gains posted after last week’s knife attack targeting conservative Jair Bolsonaro spurred speculation his candidacy would get a boost. Candidates on the left, who investors fear would backtrack on efforts to shore up Brazil’s fiscal accounts, were the only ones who gained support at a level that exceeded the margin of error in a Datafolha poll released last night.
Brazilian legendary hedge-fund manager Luis Stuhlberger is taking advantage of election jitters to step up his bet on stocks. The "Brazilian market continues on its frantic search to adjust to election odds on a daily basis," Stuhlberger’s Verde Asset Management SA said in a monthly note to clients. The fund took advantage of the Ibovespa’s 11 percent drop in dollar terms last month to "marginally" increase its position on Brazil stocks.
It’s stacking up to be another roller-coaster week for emerging markets, still reeling from a sell-off that drove stocks into a bear market for the first time since March 2016. Central banks in Turkey and Russia will make key rate decisions, with investors waiting to see how far policy makers will go to defend their weakening currencies. Meantime, the near-fatal stabbing of election front-runner Jair Bolsonaro will remain a focus in Brazil.
The assassination attempt that upended Brazil’s presidential race is also resetting the outlook for the country’s markets. Brazil equities, the currency and sovereign bonds have all rallied since front-runner Jair Bolsonaro suffered a near-fatal stabbing at a campaign rally Thursday, and RBC Capital Markets to Aberdeen Asset Management have made favorable comments about Brazilian assets in the aftermath.
Brazil’s far-right presidential candidate Jair Bolsonaro, who leads opinion polls ahead of the October vote, was stabbed during a rally on Thursday afternoon and is being treated in hospital. Bolsonaro’s son, Flavio, confirmed on Twitter that his father was stabbed in the abdomen in the city of Juiz de Fora, in the state of Minas Gerais. After initially saying the candidate was doing fine, he later said the injuries were more serious than first reported but that his father was "stable now." Video footage showed Bolsonaro atop supporters’ shoulders, clutching his stomach and grimacing after the assault.
Last week’s gains may turn into yet another short-lived reprieve as Turks return to work after a long holiday and anxiety over elections in Brazil grows. There are other reasons for investors to shun riskier assets. The trade skirmish between the U.S. and China may get uglier.
Emerging-market assets fell for a third week as investors digested Turkey’s promise to refrain from capital controls and moves by the U.S. and China to restart trade negotiations. Turkey’s credit rating was cut further into junk. The MSCI Emerging Markets Index fell 3.7 percent in its biggest weekly decline since February as of the U.S. close Friday, while a gauge tracking currencies dropped 0.8 percent.
Emerging-market assets resumed declines as an escalation in trade clashes between the U.S. and China deterred risk-taking in an already fragile developing-market landscape. The MSCI Emerging Markets Index of stocks fell 1.7 percent, the most since June, while a gauge tracking developing-economy currencies declined 0.5 percent.
Emerging-market stocks and currencies extended gains into a third day as the U.S. dollar resumed losses amid a lull in the trade war.
Emerging-market currencies declined for a sixth straight week after the U.S. fired the first shot in a trade dispute between the world’s biggest economies. The gauge tracking the developing-market stocks declined 0.9 percent, while the Bloomberg Barclays index of EM local-currency government bonds climbed 0.1 percent.
An end-of-week bounce wasn’t enough to reverse the drop for emerging markets, whose stocks and currencies posted their worst quarter since 2015 amid escalating trade-war concern and weakness in China.
Emerging markets joined a rebound in riskier assets after a selloff that drove stocks and currencies to their worst quarter since September 2015 amid escalating tensions between Washington and Beijing....
Stocks in developing nations slumped as heightened concern that a trade war will sap global economic growth put equity gauges worth $8 trillion in a bear market. Currencies also retreated and are heading ...
“My current view on Brazil might best be described as ‘concerned’ that the movement for total government reform could slow as a result of the continued popularity of Lula and his supporters,” said Mobius, who left Franklin Templeton Investments earlier this year to set up Mobius Capital Partners LLP.