The rout in emerging markets showed no sign of letting up, with an index of stocks slipping toward bear territory and a basket of currencies weakening to its lowest since May 2017.
South Africa’s rand led losses, falling to a two-year low, followed by the South Korean won and Mexican peso. The MSCI Emerging Markets Index of shares extended its slide to 19.7 percent from a January peak. Among the worst-hit stock markets were Saudi Arabia and Indonesia, where benchmark indexes tumbled by the most in about two years. Turkey’s lira rallied, meantime, on speculation the central bank will raise interest rates next week.
The declines added to concern that investor anxiety is beginning to infect markets whose economies are more robust than others. The negative tone was set Tuesday by a U.S. manufacturing report that boosted the odds of further Federal Reserve rate increases and a strengthening dollar, and South African data showing the economy entered into a recession in the second quarter.
