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* China virus stokes fears of economic impact
* S.African rand set for worst day is over two weeks
* Russian rouble touches three-week lows
By Shreyashi Sanyal
Jan 27 (Reuters) - Emerging market currencies and stocks
fell broadly on Monday, as investors grappled with the potential
economic impact of China's spreading virus outbreak.
Asian markets took a big hit with thin trading volumes on
account of the Lunar New Year holiday, while the yuan fell in
offshore trade to its lowest level in three weeks.
South Africa's rand was on track for its worst day in more
than two weeks.
MSCI's index for emerging market stocks shed 0.7%,
while the currencies index fell 0.3%. Both
indexes had registered their first weekly decline since early
December on Friday, bucking a seven-week rally.
Fears around the potential economic damage the coronavirus
outbreak in China could cause battered risk appetite, as the
death toll rose to 81 on Monday.
"The Wuhan virus will of course hang like a shadow over
financial markets this week," Jeffrey Halley, senior market
analyst, Asia Pacific at OANDA wrote in a note.
"With asset markets pumped up on hopes of a global
post-trade deal recovery and cheap central bank money, an
unexpected growth shock could leave them particularly vulnerable
to a potentially strong downward correction."
The South African rand slid nearly 1% to 14.5458
against the dollar, as it tested its biggest one-day percentage
decline since Jan. 10.
The South African currency has come under strain in January
as demand was hurt by weak growth outlook for the economy after
the International Monetary Fund and South African Reserve Bank
downgraded their growth predictions earlier this month.
South African stocks slid 2% to over a one-month
low after a set of weak corporate earnings reports. Retailer
Woolworths fell 4% after a profit warning.
African miner Petra Diamonds' reported lower
first-half revenue, hurt by lower prices as the diamond industry
grappled with soft demand from China and Hong Kong.
Among other currencies, the Turkish lira edged
slightly lower against the dollar, while Russia's rouble
also weakened.
A drop in oil prices pushed Russia's currency to three week
lows.
For GRAPHIC on emerging market FX performance in 2020, see http://tmsnrt.rs/2egbfVh
For GRAPHIC on MSCI emerging index performance in 2020, see https://tmsnrt.rs/2OusNdX
For TOP NEWS across emerging markets
For CENTRAL EUROPE market report, see
For TURKISH market report, see
For RUSSIAN market report, see
(Reporting by Shreyashi Sanyal in Bengaluru)
