Emerging Currencies, Stocks Halt Rally in Thin May Day Trading

Emerging-market stocks and currencies fell Thursday in a muted session with most of the world observing the May Day holiday.

MSCI indexes for equities and currencies in developing markets each dropped 0.3%, before end-of-day adjustments, halting a multiple-day rally. The Mexican peso and South African rand swung between gains and losses, while a measure of the dollar’s strength jumped to the highest in two weeks.

Shares in the US also advanced, propelled by optimism over corporate earnings and dissipating tariff concerns after Chinese state-run media reported the Trump administration had sought out to kick off trade talks. A metric ...