Stocks edge up on brief reprieve to Middle East tensions, oil prices slide

Reuters

Stocks edge up on brief reprieve to Middle East tensions, oil prices slide

10:04 sáng giờ GMT, 28 Tháng 10 2024

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Updated at 0926 GMT

Indian equities rebound

China launches new lending tool before year-end loan expiry

US, EU call for probe into Georgia elections

MSCI EM stocks index up 0.2%, FX flat

By Johann M Cherian

Oct 28 (Reuters) - Equities across most developing markets edged up on Monday as crude prices dropped on a brief respite to geopolitical tensions in the Middle East, while investors also braced for the upcoming U.S. presidential election.

Crude futures lost over 5% to about $70 a barrel as Israel's response to Iran's missile attack over the weekend avoided oil and nuclear targets, relieving concerns of a wider conflict that could disrupt energy supplies - a crucial resource for developing economies.

"The prospect of a full-blown war between Iran and Israel may have diminished but it remains a significant source of geopolitical risk," said Elias Haddad, a senior markets strategist for Brown Brothers Harriman.

MSCI's index tracking bourses in emerging markets .MSCIEF edged up 0.2%, while an index tracking currencies .MIEM00000CUS was flat.

The MSCI gauges had logged losses during the previous three weeks as uncertainty loomed about the implications next week's U.S. elections can have on developing economies.

Currencies of net oil importers such as Philippines PHP= and South Africa ZAR= edged up 0.5% and 0.2% respectively, while those of India INR=IN and Turkey TRYTOM=D3 were little changed. Oil exporter Nigeria's naira NGN= depreciated 2%.

Israel's shekel ILS= appreciated 1.7%. The directors of CIA and the country's Mossad are expected to have met Qatar's prime minister in Doha on Sunday to begin negotiations for a short-term ceasefire between Israel and Hamas.

Meanwhile, Indian equities .NSEI, .BSESN rose 1%, rebounding from four straight weeks in the red, following upbeat results from the financials sector.

South Korean stocks .KS11 closed 1% higher as local battery suppliers of Tesla TSLA.O gained after the EV market leader's rally last week. Gains were also aided by LG Energy Solution's 373220.KS 2.3% rise following upbeat quarterly results.

Chinese blue chips .CSI300 closed up 0.2% and Hong Kong stocks .HSI were largely flat, as investors grew cautious ahead of key events next week, including a legislative meeting in Beijing and the U.S. election.

Local sovereign bonds CN2YT=RR, CN5YT=RR, CN10YT=RR, CN30YT=RR were muted as investors showed no enthusiasm after the central bank launched a new lending tool ahead of the expiry of trillions of yuan in loans at the end of the year.

Georgian local currency bonds GE1YT=RR, GE3YT=RR, GE5YT=RR were little changed after the ruling pro-Russia Georgian Dream party received more than 54% of the vote in a parliamentary election. The U.S. and European Union called a full investigation into reports of violations to the vote.

Investors also monitored election developments in Bulgaria and Lithuania.

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 Varun H K

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