Emerging-market shares rose on Monday as data from China helped to allay fears about the world’s second-largest economy and a weaker dollar boosted most developing-world currencies.
Second-quarter economic growth in China slipped to its slowest in at least 27 years, although it was in line with expectations. Separate data for industrial output and retail sales beat expectations.
“The June industrial production and retail sales data were both stronger than expected, which has encouraged speculation that stimulus is having a positive impact,” Rabobank analysts said.
The encouraging data, a result of Beijing’s efforts to prop up domestic growth and offset some of the damage from a trade war with the United States, lifted the mood across equity markets.
MSCI’s index for emerging-market shares rose more than half a percent, led by Asian indices. Mainland China shares gained 0.4%, Hong Kong’s 0.2%.
South Korea’s kospi, however, snapped a three-session winning streak and closed 0.2% lower. Concern over second-quarter corporate earnings and a fragile domestic economy weighed on the index. The won was flat.
Outside Asia, Russian shares were lower as falling oil prices caused energy stocks to fall. South African stocks gained 0.4%, boosted by Naspers.
In currencies, the Indonesian rupiah gained to its strongest in more than five months, underpinned by recently re-elected President Joko Widodo’s promise of faster infrastructure development and more investment opportunities.
South Africa‘s rand and Russia’s rouble gained 0.3% to 0.6%.
Turkey’s lira made nominal moves, but its dollar-denominated government bonds came under pressure on concern that Washington could impose sanctions on Ankara over its purchase of a Russian air defence system.
NATO member Turkey started taking delivery of parts for the Russian S-400 missile defence system on Thursday, despite warnings from Washington that the move would trigger US sanctions.
Turkish stocks fell more than 2% on Friday. The market was closed on Monday for a public holiday.
In emerging Europe, both the Hungarian forint and the Polish zloty rose against the euro. The Czech crown fell 0.2%.