EMERGING MARKETS-Stocks near 1-month high on Chinese trade data; FX muted

Emerging market stocks came close to touching a one-month high on Tuesday after China published better than expected trade data, but investors remained extremely wary as the coronavirus pandemic continues to ravage the global economy. Currencies were little changed.

The MSCI's index of emerging market stocks rose about 1.1% to its highest level since March 16 but was still about 22% off a peak hit in January. The day's gains were largely spurred by data showing that China posted a better than expected trade balance in March. Still, with global business activity at a near standstill due to the outbreak, the outlook for sustained trade appeared grim.

"Removing the restrictive measures and reopening economies around the globe may be a very slow procedure, as governments may want to make sure that the virus has indeed been contained," Charalambos Pissouros, Senior Market Analyst at JFD Group wrote in a note. "We are still reluctant to trust a long-lasting recovery, and we prefer to take things day by day."

Recent data showing a slowing pace of new infections in the outbreak's epicenters had brewed some optimism in markets. However, investors have stuck to largely cautious plays owing to uncertainty over when economic disruptions from the pandemic will wind down. Chinese stocks closed up nearly 2%, while the yuan was largely flat after the data.

Equity markets in Turkey rose about 1.6% to a one-month high, while South African stocks added about 1.3%. Russian stocks rose with the rouble in tow after oil prices were propped up by forecasts of a drop in U.S. output, following a production cut by the Organization of the Petroleum Exporting Countries over Easter. The sentiment was still shaky on the forex side, with the MSCI's index of developing world currencies inching up about 0.1%. Safe-haven demand for the dollar had prompted massive outflows from risk-driven assets over the past month.

The index was nearly 6% off a peak hit in January. Turkey's lira traded sideways, while the South African rand firmed about 0.6%, extending its recovery from a record low touched last week.

The Hungarian forint, Czech koruna, and the Polish zloty all firmed slightly to the euro.