Emerging Assets Drop as Risk-Off Mood Lifts Dollar Ahead of Fed

Emerging-market currencies and stocks dropped Tuesday as concerns over investments in artificial intelligence and stalled peace talks in the Middle East sparked a flight to safety in global markets.

MSCI’s EM currency index ended the day 0.3% lower, with most currencies in the red led by the Philippine peso, Indian rupee and Thai baht as the greenback gained. Latin American currencies gained strength during the day with the Colombian and Chilean pesos outperforming peers. A sister gauge of stocks slumped 0.8%, dragged lower by tech shares.