EMERGING MARKETS-EM currencies down as dollar firms, stocks pressured by tech rout

By Purvi Agarwal

Feb 5 (Reuters) - Most emerging-market currencies treaded water against a rising dollar on Thursday, while an ongoing rout in technology stocks pressured Asian bourses and dampened investor appetite for other EM equities.

MSCI's index tracking global EM equities .MSCIEF fell 1.5%, retreating further from a record high hit late in January.

Heavyweight Asian bourses led the losses, with South Korea's KOSPI .KS11 down 3.9% and Taiwanese equities .TWII down 1.5% as the tech selloff on Wall Street spilled into Asia, wiping off about $830 billion in market value since January 28.

Wild price swings in precious metals and a renewed tech stock rout have weighed on EM stocks, especially in markets with heavy exposure such as South Africa and Asia, respectively.

Yet, Luca Paolini, chief strategist at Pictet Asset Management, said, "As the AI rally broadens, EM technology and communication services, in markets such as Korea, Taiwan and China, stand to gain from strong demand for AI hardware and semiconductors."

"Earnings growth in EMs is expected to outpace that of developed peers, all leading to an overweight position for emerging-market stocks."

The risk-off sentiment on Thursday gripped other EM stocks as well, with those in Poland .WIG20 and Hungary .BUX down 1.1% and 1.5%, respectively. Romania stocks .BETI, however, gained 0.3%.

South African stocks .JTOPI retreated 1.4% as prices of gold and silver fell again, pressuring miners in the resource-heavy country.

Turkish equities were largely unchanged, and so was the lira TRYTOM=D3.

Most currencies remained muted against the greenback, with MSCI's measure .MIEM00000CUS off 0.3%.

South Africa's rand ZAR= tripped 0.6%. The country's trade minister will travel to China to sign the China–Africa Economic Partnership Agreement, which will provide South African exports duty-free access to the Chinese market.

Most currencies in emerging Europe were subdued against the euro. The Czech crown EURCZK= was up 0.2% ahead of a local monetary policy decision, where the central bank is widely expected to hold interest rates steady.

The headline inflation rate in the country eased to 1.6% year-on-year in January, a more than nine-year low, preliminary data showed.

Meanwhile, Ukraine and Russia started a second day of U.S.-brokered talks in Abu Dhabi, after a first day described as productive and positive by both Kyiv and Moscow.

Ukraine's international bonds, which have rallied to record highs earlier this week on hopes of a ceasefire between the warring countries, were stable.

HIGHLIGHTS:

Global investors betting on 'rising star' Malaysia as foreign cash piles in

Indonesia posts fastest economic growth rate in three years

Philippine inflation quickens to 11-month high in January

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