LONDON: Solid earnings and easing Korean tensions lifted emerging stocks on Monday, but equities and many main currencies were on track for another month of declines, still reeling from earlier losses on higher US yields and a stronger dollar.
MISC's emerging market index extended gains for a third straight day, rising 0.9 percent to hit a 10-day high thanks to healthy gains in Asia and optimism across emerging and developed stock markets following strong first quarter earnings.
South Korea's KOSPI index rose nearly 1 percent following record profits from tech giant Samsung Electronics and a successful inter-Korean summit that saw North Korean leader Kim Jong Un and South Korean President Moon Jae-in smiling and holding hands.
Investors also took heart from fresh data out of China, showing growth in the country's vast manufacturing sector eased only slightly in April in a sign of broad economic resilience.
"Relatively robust Chinese PMI (purchasing manager index) figures setting the pace for tomorrow's April releases for the rest of emerging markets," wrote Simon Quijano-Evans, emerging markets strategist at Legal & General Investment Management in a note to clients.
However, gains were not enough to make up for losses suffered earlier in the month, leaving the emerging market benchmark index headed for its third straight month in the red.
Meanwhile, currencies struggled with the dollar index taking another leg higher, and on track to book its strongest month since late 2016.
Russia's rouble weakened 0.8 percent, also knocked lower by oil prices coming under pressure amid signs of higher US production. Still suffering from the fallout of fresh sanctions by Washington, Russia's currency is on track for a near double-digit fall in April, its worst month since late 2015.
South Africa's rand eased 0.7 percent on the day falls as markets awaited the latest trade numbers and data showed that foreign investors had been net sellers of local bonds last week. The rand looked poised to end April 4.5 percent weaker - its worst monthly performance since summer 2016.
Turkey's lira - one of the most vulnerable emerging market currencies due to its large external financing requirements - was on a stronger footing than its peers.
The lira hovered unchanged after central bank governor Murat Cetinkaya pledged it would continue a tight monetary policy stance until the inflation outlook improved and that it would stick to its efforts of simplifying the country's multiple interest rate.
The bank also lifted its year-end inflation forecast to 8.4 percent from 7.9 percent in its regular inflation briefing.
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