EMERGING MARKETS-Stocks dip on China money market drain, Ukraine currency falls
By Asher Levine and Carolyn Cohn
RIO DE JANEIRO/LONDON Feb 18 (Reuters) - Emerging market stocks dipped on Tuesday, led by a drop in Chinese shares, while a fresh outbreak of violence drove Ukraine's currency towards five-year lows and weighed on its bond prices.
Chinese stocks fell around 0.8 percent as the central bank (PBOC) drained 48 billion yuan ($7.92 billion) from the country's money market after data at the weekend showed new loans surged to their highest in four years in January.
The outlook for the world's second-largest economy is key for exporters from emerging markets.
"The PBOC's decision to drain liquidity using repos is a reminder that the tightening bias remains in place and the desire to curb credit growth remains intact," Kit Juckes, strategist at Societe Generale, said in a client note.
"This should be seen as a commitment to allow the ongoing slow and steady slowdown of the Chinese economy to continue."
The MSCI emerging equities index dipped 0.25 percent after hitting 3-1/2 week highs in the previous session.
Emerging sovereign debt spreads tightened by 2 basis points to 373 bps over U.S. Treasuries. Continuación...