Emerging Market Stocks Slip Amid Central Bank Decisions and China's Demand Worries

Emerging market stocks fell as central bank meetings loomed and commodity prices dropped on concerns about demand in China. Both the Bank of Japan and the U.S. Federal Reserve are expected to make key announcements soon. Investors are cautious with a dip in global equities and weak economic data in Europe.

Emerging market stocks slipped as investors anticipated key decisions from major central banks, including the U.S. Federal Reserve and the Bank of Japan. A decline in commodity prices, driven by concerns over Chinese demand, added to the cautious sentiment. MSCI's index tracking emerging market equities fell by 0.3%, on track for a 1% drop in July, largely due to a rout in U.S. tech stocks weighing on the global market.

A gauge of emerging market currencies edged higher by 0.1% against a mostly stable U.S. dollar. Investors were also cautious following China's Politburo meeting, which pledged economic support but failed to announce any new stimulus measures. Regional financial market analyst Ahmed Azzam from Equiti Group noted dwindling optimism over China's stimulus plans.

Commodity prices such as oil, iron ore, and copper saw declines, with oil prices briefly touching their lowest since early June. Meanwhile, the Federal Reserve is expected to keep rates steady, with investors eyeing a potential dovish tone that could hint at a rate cut in September. China's blue-chip stocks and Hong Kong shares also declined for a second day.

(With inputs from agencies.)