EMERGING MARKETS-Emerging market assets rise, 'FOMO mentality' pulls investors in


By Aaron Saldanha

May 24 (Reuters) - Emerging market stocks rose on Friday, licking their wounds after the previous day's losses, while developing world currencies firmed the most in two weeks against a softer dollar.

Investors tip-toed back into the developing world, upping exposure to risky assets which were walloped on Thursday as capital made a dash for the exits on rising U.S.-China trade fears. MKTS/GLOBFRX/

"Investors are largely neutral on EM, this is because most investors seem to have a fear-of-missing-out (FOMO) mentality," Min Dai, Morgan Stanley's head of Asia Rates and FX Strategy, wrote in a note.

"The risks to a neutral view are that investors could be dragged in either direction if the market moves, exacerbating the volatility."

MSCI's index of developing world stocks .MSCIEF rose 0.3%, with Chinese blue-chip shares .CSI300 matching that gain. MSCI's emerging market currencies index .MIEM00000CUS added 0.2%.

Turkey's lira TRY= ticked 0.1% firmer, while stocks .XU100 rose 1%, trimming their degree of underperformance relative to the MSCI developing world equities benchmark.

Higher oil prices underpinned a 0.4% firming in Russia's rouble RUB= as it lifted off Thursday's eight-day closing low, while rising energy stocks pushed the Russian index .IMOEX 0.6% higher.

Brent crude futures LCOc1 rose 0.9%, making back a fraction of Thursday's 4.6% slide, which was their worst loss in about five months. O/R

South Africa's rand ZAR= was 0.6% stronger. The country's central bank kept lending rates unchanged at 6.75% on Thursday in a decision that divided policymakers.

While inflation and inflation expectations were close to the middle of the central bank's 3% to 6% target range, they had not yet settled there.

South African stocks .JTOPI added 0.4%, although Old Mutual Ltd OMUJ.J fell about 1%.

The country's No.2 insurer said its chief executive had been suspended following a "material breakdown in trust" between him and the board.

Stocks in Warsaw .WIG20 traded 0.8% higher. PKN Orlen PKN.WA rose 1.2% after Morgan Stanley boosted its rating on Poland's biggest oil refiner to "overweight" from "equal-weight".

The broker said the disruption of crude exports from Russia appears to be short-lived and Poland may start receiving clean crude on June 9.

For TOP NEWS across emerging markets

For CENTRAL EUROPE market report, see CEE/

For TURKISH market report, see .IS

For RUSSIAN market report, see RU/RUB

Rebased performance of select indexes in the one month through Thursday https://tmsnrt.rs/2Er65k4

(Reporting by Aaron Saldanha in Bengaluru; Editing by Catherine Evans)

((Aaron.Saldanha@thomsonreuters.com; +91 80 6749 1130; Reuters Messaging: Aaron.Saldanha@thomsonreuters.com@reuters.net))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


More Related Articles

Info icon

This data feed is not available at this time.

Sign up for Smart Investing to get the latest news, strategies and tips to help you invest smarter.