Emerging-market stocks extended their longest losing streak this year after data showed China’s manufacturing may contract for a fifth month while euro-area services and factory output shrank more than economists forecast, reports Bloomberg.
The MSCI Emerging Markets Index (MXEF) fell 0.7 percent to 1,040.39 by 10:39 a.m. in New York, slipping for a sixth day. Energy and materials companies retreated the most, with OAO Gazprom, the world’s largest natural gas exporter, tumbling 2 percent. JBS SA (JBSS3), the world’s largest beef producer, headed for its biggest loss in two months after reporting lower-than- expected profit for the fourth quarter.
A preliminary measure of Chinese manufacturing fell to 48.1 in March, the lowest level since November, according to data from HSBC Holdings Plc and Markit Economics. A euro-area gauge of services and manufacturing output dropped to 48.7 from 49.3 in February, London-based Markit said in an initial estimate today, below all but one forecast in a Bloomberg News survey of 21 economists. Readings below 50 indicate contraction.
“This reinforces a sense that growth is slowing down, but for China at least we think we come out on the other side of this with easing,” John Lomax, an emerging-markets strategist at HSBC, said by phone from London. “For Europe, it’s a bit more problematic in that Europe doesn’t have the ability to change policy in the same way, and it suggests a recession this year.”