The MSCI emerging-markets stock gauge rose 0.2%, driven by performance in consumer and health care shares and extended its weekly advance to 2.1%. The equivalent benchmark for currencies added 0.1%, led by the Czech Koruna, Thai baht and Hungarian forint.
Risk sentiment was boosted by the end of longest government shutdown in US history. Meantime, investors are preparing for market volatility as the release of economic data resumes in Washington, creating more uncertainty about the Federal Reserve’s next steps.
The shutdown and absence of economic data has put the Fed into “a forced state of blindness,” said Juan Perez, senior director of trading at Monex. “The US government shutdown being over has not translated into a positive item for the US or the USD but rather a complicated message that signals trouble and uncertainty,” Perez added. But positive factors are still there for emerging markets, including the demand for energy, a truce to the US-China trade war and some tariff reliefs, he said.
The October jobs report will be released without a reading of the unemployment rate, according to National Economic Council Director Kevin Hassett. The September report will likely come out next week, he added.
“The dollar is likely to remain under pressure,” Commerzbank analysts Tommy Wu and Moses Lim wrote in a note. “The delays in key economic data have created difficulties for the markets and the Fed to gauge the economic outlook.”
Elsewhere in currencies, the Chilean peso gained to the strongest level since early July as investors bet on a market-friendly election outcome. The Colombian peso weakened, paring a bullish run in recent days.
The rand strengthened below 17 per dollar for the first time since February 2023 after the South African government adopted a lower inflation target, suggesting interest rates may stay higher for longer. South African stocks also rallied, with gold miners and banks among leading gainers as the precious metal and the rand advanced.
The Malaysian ringgit, Asia’s best-performing currency this year, neared a four-year high as strengthening economic momentum and easing global trade tensions drove offshore investors to local debt.
