EMERGING MARKETS-Stocks, currencies slide on weak Chinese exports
By Walter Brandimarte and Sujata Rao RIO DE JANEIRO/LONDON, March 10 (Reuters) - Emerging stocks fell over 1 percent on Monday after poor Chinese export data re-ignited global concerns of a slowdown in the world's No. 2 economy and pushed Chinese shares to a five-year closing low. Prices of iron ore, copper and other metals imported by China dropped to multi-month lows, weighing on shares of miners across the globe, as weekend data showed Chinese exports unexpectedly tumbled in February, driving the country's trade balance into deficit. The data piled fresh pressure on emerging assets which looked shaky after robust U.S. jobs data on Friday boosted Treasury yields, potentially reducing investors' appetite for risk assets. Chinese mainland shares fell more than 3 percent and losses rippled across emerging markets, dragging MSCI's main emerging equity index off six-week highs hit last week. In Brazil, the benchmark Bovespa stock index slid as much as 2 percent to an 8-month low, knocked down by shares of the world's largest iron ore producer, Vale SA, which tumbled more than 3 percent and was on track for its lowest close in nearly nine months. "Emerging markets had basically two (bits of) negative news in the last 2-3 days - U.S. non-farm payrolls which increased the possibility that tapering will intensify, and quite poor Chinese data," said HSBC strategist Murat Toprak. Emerging market currencies also suffered, with the Chilean peso losing 0.8 percent to its weakest level since May, 2009. Chile's main export product, copper, slid to an 8-month low after the Chinese data. The Brazilian real bucked the broader emerging market trend, however, gaining 0.1 percent after the central bank late on Friday announced it would start rolling over on Monday $10.15 billion worth of currency swaps that mature early next month. Brazilian policymakers have been steadily offering swaps to provide investors with a hedge against a possible depreciation of the real. Traders said the real was also supported by speculation that Brazil's government-controlled oil company Petroleo Brasileiro SA could convert into reais at least part of the dollars it is raising through a six-part bond sale on international capital markets. The deal has attracted some $12 billion in demand so far, according to Thomson Reuters' IFR. INDIA RALLY HALTED The Chinese data also brought down Indian shares from their third consecutive record high, with metals shares down 1.5-3.0 percent. Mumbai stocks have been rallying ahead of elections that many investors expect will bring in a more reform-friendly government. Foreign funds have pumped $1.4 billion into Indian shares in the past two weeks. South Africa's mining-heavy stock index fell more than 1 percent on the day, with Kumba Iron Ore tumbling more than 7 percent and heading for its biggest one-day loss in five months. Kumba's main market is China. Moscow markets were closed for a holiday but the stock market has suffered three straight weeks of losses, while the rouble is trading just off record lows to the dollar on tensions with Ukraine over Russian troops' presence in Crimea. Russian forces tightened their grip on Crimea over the weekend, fanning tensions ahead of a planned Moscow-backed referendum next Sunday on whether the Black Sea peninsula should join Russia. Ukrainian markets were also shut. Key Latin American stock indexes and currencies at 1548 GMT Stock indexes daily % YTD % Latest change change MSCI Emerging 954.7 -1.24 -3.59 Markets MSCI LatAm 2876.22 -1.48 -8.79 Brazil Bovespa 45427.05 -1.77 -11.80 Mexico IPC 38696.94 -0.56 -9.43 Chile IPSA 3654.95 -1.16 -1.20 Chile IGPA 18086.51 -0.94 -0.77 Argentina MerVal 5817.01 -1.08 7.90 Colombia IGBC 12796.39 -0.19 -2.10 Peru IGRA 15075.52 -0.36 -4.30 Venezuela IBC 2689.33 -1.81 -1.73 Currencies daily % YTD % change change Latest Brazil real 2.3440 0.15 0.55 Mexico peso 13.2194 -0.24 -1.43 Chile peso 570.4 -0.77 -7.77 Colombia peso 2042.54 -0.27 -5.41 Peru sol 2.801 0.00 -0.29 Argentina peso 7.8650 -0.03 -17.45 Argentina peso 10.9 1.38 -8.26
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