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2026-02-19 18:14:56
[Renewed Geopolitical Tensions Pressure Emerging Markets' Stocks and Currencies] ⑴ On Thursday, most emerging market currencies weakened slightly due to escalating global geopolitical tensions, while stock markets remained largely unchanged. The MSCI Emerging Markets Currency Index fell 0.2%, hitting a more than one-week low; the stock market index was flat. ⑵ With most Asian markets closed this week for the Lunar New Year holiday, emerging market assets generally traded within a range. However, while progress was seen in the US-Iran nuclear negotiations, differences remain, and the market has not ruled out the possibility of military action. Rabobank strategists warned that if the US launches an attack after Friday's close, it could trigger sharp market volatility, potentially causing oil and LNG prices to surge. ⑶ Regarding the Russia-Ukraine peace talks, two days of negotiations yielded no breakthroughs. The Ukrainian president expressed dissatisfaction with the results, while the US claimed to have made "meaningful progress." The differing positions of the parties lead analysts to believe that a reconciliation is unlikely in the short term. Ukrainian international bonds stabilized on Thursday after falling by more than 1 cent in the previous trading day. ⑷ The Federal Reserve meeting minutes showed that policymakers were in no hurry to cut interest rates, which initially supported the dollar, but the dollar index ultimately closed down 0.1%. The South African rand fell 0.6%, marking its fourth consecutive day of decline; the Turkish lira held steady, while its stock market fell 1.7%; South Korean stocks surged over 3% to a record closing high, boosted by technology stocks. The Philippine central bank cut interest rates by 25 basis points, while the Indonesian central bank held rates steady, with both currencies showing little reaction.
