Emerging-market currencies are trading mixed in a session buffeted by updates out of the Middle East, including a report that Iran has stopped talks with the US just hours before the deadline for a peace deal.
MSCI’s index tracking currencies in developing countries trimmed earlier gains after Iran told Pakistan it won’t engage in ceasefire talks with the US, according to a New York Times report. The gauge was up 0.2% by midday in New York. A sister barometer tracking emerging-market equities advanced 0.7%.
“Markets are at a point where wait and see is all they can do,” said Brendan McKenna, an emerging-market strategist at Wells Fargo in New York. “Gauging the direction or intensity of the conflict is impossible, and the rhetoric out of the administration this morning was concerning.”
Trump repeated threats to destroy Iran earlier on Tuesday, saying the country would “die tonight” if it didn’t reach an accord. The US conducted airstrikes on a key oil hub, pressing Tehran to reopen the Strait of Hormuz by 8 p.m. or face attacks on critical infrastructure.
“A whole civilization will die tonight, never to be brought back again,” Trump posted on social media. “I don’t want that to happen, but it probably will.”
US stocks fell and bond yields rose on concern the Strait of Hormuz — which accounts for about a fifth of global oil supplies — won’t open any time soon.
“No passage, no peace for markets,” writes Elias Haddad, global head of markets strategy at Brown Brothers Harriman.
Meanwhile, in credit markets, Brazil is sounding out investors as it weighs a return to global debt markets, potentially paving the way for its first euro-denominated issuance in more than a decade. And Poland is the latest emerging-market sovereign to return to international bond markets since the start of war in Iran, offering a three-tranche, dollar-denominated debt issue.
This article was generated from an automated news agency feed without modifications to text.
