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Currencies across developing markets were steady on Tuesday as investors cautiously awaited details of US President Donald Trump's reciprocal tariffs, while South Africa's rand slipped on prolonged negotiations over the domestic budget.
MSCI's index tracking emerging market currencies was flat against the dollar, while a gauge for stocks rose 0.7%, bouncing back from two-week lows.
In South Africa, the rand weakened 0.3% and the benchmark bond slipped, with the focus on final negotiations on the national budget. The lower house of parliament could potentially vote on the bill on Wednesday. The rand reached R18.42/$ earlier on Tuesday. By lunchtime, it was trading at R18.34.
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The local currency has depreciated about 0.7% since early March as government coalition partners disagreed on a revised budget.
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Trump is expected to announce reciprocal trade barriers on Wednesday that are set to match other countries' higher tariff rates for specific goods and compensate for non-tariff barriers that put US exports at a disadvantage.
Analysts say the policies could dent global growth, especially for trade-reliant developing economies. Still, the MSCI indexes finished the previous quarter on a strong note as investors looked for bargains out of the US.
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The JSE's All-Share index climbed more than 1% by lunchtime on Tuesday, with Sibanye Stillwater and Sasol up more than 4%. However, Implats and Anglo declined 1%.
Last month, the bourse's mining index jumped 33%, which according to Bloomberg is the biggest monthly gain on record.
Indian stocks fell more than 1.5% as trading resumed after a public holiday in the previous session.
Where tariffs are concerned, "India is more likely to be in the firing line this time around," Diederik Stadig, an economist at ING, said in a note.
"Trump has repeatedly referred to the country as a 'tariff king' in the past, and last week, the U.S. President reiterated his comments on wanting to institute tariffs on the import of pharmaceuticals."
In eastern and central Europe, Poland's zloty firmed 0.3% against the euro after a survey showed the manufacturing sector posted its strongest performance in nearly three years in March.
The domestic central bank is also expected to convene on Tuesday and decide on policy rates, with economists polled by Reuters anticipating no change.
Hungary's forint was flat, while local stocks gained 0.7%. MBH Bank lost 1.5% on signs that the Hungarian state was mulling a potential sale of its 20% stake in the lender.
In China, Shanghai equities rose 0.3% as data showed business activity expanded in March, bolstered by robust export orders.
Hong Kong stocks added 0.3%, with CK Hutchison climbing 1.7% ahead of a deal to sell the conglomerate's Panama ports to a BlackRock-led group that is due to be signed by April 2.
Israel's shekel strengthened 0.6%, while the local stock index added 0.6%. Credit ratings agency Fitch affirmed the country's ratings and outlook, but flagged risks from a high public debt/GDP ratio and the ongoing conflict with Gaza.
Additional reporting by News24.
