This is how the rand, JSE fared against other emerging markets in 2018

PUBLISHED: Mon, 31 Dec 2018 14:29:35 GMT

Dec 31 (Reuters) – Emerging-market stock indexes inched higher on Monday, the last trading day of a rough year for developing economies, as investors cast a cautious eye on President Donald Trump’s latest claims of “big progress” in Sino-U.S. trade relations.

Over the weekend, Trump tweeted: 

With most markets already shut for the New Year holiday, that was enough to drive a fourth day of gains for India’s benchmark indices , as well as a gain of 0.5 percent in South Africa.

But overall, MSCI’s index of emerging-market shares was still set to log losses of more than 16 percent for 2018 as a whole.

“(The) market is more likely to stay put at this point and wait for further solid evidence from the face-to-face meeting in mid-January,” analysts at Mizuho Bank said in a note.

The trade dispute between the world’s two biggest economies has been a major factor worrying financial markets all year.

After agreeing in November to halt additional tariffs and reach an agreement within 90 days, a U.S. trade team will travel to Beijing next week to hold talks with Chinese officials.

In a year where a cocktail of higher oil prices, rising borrowing costs and domestic politics have hurt riskier assets, a 3 to 6 percent yearly gain for Indian indices makes it one of the few emerging markets in the black.

Russian stocks, which had their last trading session on Friday, will end with a 12 percent rise. Stock markets in China, Turkey and South Africa are set to post their worst year in a decade, see below.

Most Asian currencies gained on Monday as the dollar trod water. The South African rand gained 0.4 percent, while Turkey’s lira weakened, on course for a yearly loss of more than 28 percent.

Concerns about President Tayyip Erdogan’s influence on monetary policy and relations with the United States have been soothed by September’s 6-percentage-point hike in interest rates and the release of a jailed U.S. pastor. But fears over high prices of imported oil will continue to have an effect.

The rand is also set for a yearly loss after South Africa slipped into its first recession since 2009 in the second quarter.

The worst performer of commonly watched emerging-market currencies is Argentina’s peso, which has halved in value against the dollar.

Runaway inflation has led Argentina to raise benchmark interest rates dramatically – first to 45 percent, then to 60 percent – pushing its economy into recession and prompting it to turn to the International Monetary Fund for a funding facility to shore up its finances and halt the currency’s plunge.

Eastern European currencies barely moved on Monday against a steady euro. On the year, a roughly 3 percent fall for the Hungarian forint would be its worst result since 2014. 

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