July 12, 2011Emerging stocks fall 2 pct on euro zone worry
Emerging stocks tumbled 2 percent on Tuesday, tracking steep losses in global equity markets and commodities on signs that more and more countries are falling victim to the euro zone debt crisis.
MSCI's emerging equity index hit a new two-week low .MSCIEF, after losses of 1.8 percent in the previous session. That brings losses so far this week to almost 4 percent.
Emerging sovereign debt spreads also widened by a sharp 9 basis points versus U.S. Treasuries, which were enjoying a flight-to-safety rally 11EMJ.
Investors are worried that large euro zone periphery states Italy and Spain are on the verge of suffering the same fate as Greece, Ireland and Portugal, which have so far managed to stave off default through multi-billion dollar bailout packages.
The losses fuelled by euro zone fears rippled worldwide, with Chinese shares closing 1.7 percent .SSEC lower, while most other Asian stock markets also tumbled.
http://af.reuters.com/article/southAfricaMarketNews/idAFLDE76B0FA20110712
