(Bloomberg) -- Emerging-market stocks rose and currencies were mixed on Friday, with traders expecting the Federal Reserve to still be on track to lower interest rates later this month following the release of the US jobs report.
An MSCI Inc. gauge for developing currencies was little changed as of 9:20 a.m. New York. The Thai baht and the Colombian peso were among the best-performing names in a basket of developing-world currencies tracked by Bloomberg. US nonfarm payrolls came in above estimates and unemployment rate edged higher in November. While policymakers are still expected to lower borrowing costs at their next meeting, investors are weighing the odds of a “hawkish cut” being delivered by the Fed.
“The US economy, labor market — none of it is really significantly cooling, said Juan Perez, director of trading at Monex USA. “It is hard to think that once they cut by 25 basis points this month that they will feel any need to be very stimulus-driven going into 2025.”
The MSCI EM stock index held gains after the data, rallying for a fifth day in the longest winning streak since Sept. 27. The advance was led by Hong Kong-listed blue-chip equities including Tencent Holdings Ltd. and Alibaba Group Holding Ltd. Traders are speculating that China could deploy more economic stimulus while they wait for a key policy meeting scheduled for Wednesday.
“While the upcoming Central Economic Work Conference next week will signal further support for domestic demand, it may once again refrain from rolling out sizable stimulus measures that the markets are hoping for,” Commerzbank economists Tommy Wu, Charlie Lay and Xuan Hui Lorraine Seah said in a report. South Africa’s bonds outperformed on Friday, with notes maturing in 2052, gaining 1 cent on the dollar. Romanian assets are in focus after the country’s top court canceled the presidential election, ordering a rerun of the vote.
Romania’s 2031 global bond in euros rose to a session high of 99.5 cents on the news, according to indicative pricing data collected by Bloomberg. The leu trimmed some its losses versus the euro, Bloomberg pricing data showed.
In South Korea, military officials said there’s no need to worry about a possible second martial law decree, while the head of the ruling People Power Party called for the President Yoon Suk Yeol to be suspended from office quickly.
