Emerging Markets Face Turbulence Amid Global Market Fluctuations

Emerging market stocks experienced significant declines due to global market uncertainties, particularly concerns over AI valuations. The MSCI index dropped 1.8%, with further losses across Asian stocks. The Central-Eastern European region awaited Hungary's interest rate decision amid fiscal pressures and election-related spending concerns, affecting currencies and stock indices.

On Tuesday, emerging market stocks faced a downturn as global sentiment cooled due to renewed worries over AI-related valuations. This downturn comes ahead of Hungary's critical interest rate decision.

The MSCI's emerging market stock index fell by 1.8%, nearing a one-month low, driven by investor concerns surrounding big-tech and AI stock valuations and the significant capital influx into the sector.

In Central-Eastern Europe, attention turned to the Hungarian National Bank's interest rate announcement, with expectations it would maintain the EU's highest rate at 6.5%. Amidst political and fiscal pressure, Hungary's forint depreciated, while inflation and financial stability remain key concerns.

(With inputs from agencies.)