Jakarta - Emerging-market stocks fell to a three-week low and Asian currencies weakened as US jobs data spurred speculation the Federal Reserve will bring forward the timing of interest-rate increases.
Taiwan Semiconductor Manufacturing Company led technology companies lower. Indian shares sank 2 percent and Indonesia equities retreated from a record high. South African shares sank 1 percent. South Korea’s won decreased 1.2 percent versus the dollar and Malaysia’s ringgit slid to a 2009 low. China’s stocks jumped 1.9 percent as banks rallied after regulators said they may allow lenders to enter the brokerage business.
The MSCI Emerging Markets Index dropped 0.9 percent to 962.58 at 8.16am in London, its seventh day of declines, poised for the longest losing streak since December 16. The odds of a US rate increase by September surged to 60 percent from 49 percent on Thursday, futures showed. Data showed US employers added more jobs than forecast in February and the unemployment rate dropped to the lowest in almost seven years.
“The US jobs number came in better than expected,” Andy Ferdinand, head of research at PT Batavia Prosperindo Sekuritas, said by phone from Jakarta. “Emerging-market investors are more concerned of the risk of higher interest rates as a result of the employment numbers.”
The emerging-markets index has risen 0.7 percent this year and trades at 11.6 times projected 12-month earnings, data compiled by Bloomberg show. The MSCI World Index has gained 1.8 percent in 2015 and is valued at a multiple of 16.6.
Technology shares
All 10 industry groups in the developing-nation measure fell, led by a 1.8 percent slide in technology stocks. Taiwan Semiconductor dropped 2.4 percent in Taipei. Samsung Electronics Company lost 1.5 percent, dragging the Kospi index by the most since January 16. The won weakened to a three-month low.
India’s S&P BSE Sensex index tumbled the most since January 6 and the Jakarta Composite Index retreated 1.6 percent. The FTSE Bursa Malaysia KLCI Index fell to a three-week low. The ringgit and India’s rupee slid at least 0.7 percent, while Indonesia’s rupiah weakened to a 1998 low.
The Shanghai Composite Index jumped the most in a week. Industrial & Commercial Bank of China Ltd rallied 4.2 percent after the China Securities Regulatory Commission said it’s considering allowing banks to apply for securities licences.
Hong Kong’s Hang Seng China Enterprises Index added 0.6 percent. Dubai’s DFM General Index gained 0.5 percent. The FTSE/JSE Africa All Share Index headed for the steepest decline since January 14. The rand fluctuated after weakening to a 13-year low on Friday. Turkey’s stock index rose 1 percent and the lira added 0.6 percent. Russia’s market was closed for a holiday.
* With assistance from Zhang Shidong in Shanghai
Bloomberg