* China keeps one-year money market rate unchanged
* Forex index negative for the first time in 10 sessions
* Hong Kong shares slump after Moody’s lowers credit outlook
* Russian rouble weakens after robust gains in previous session
By Agamoni Ghosh
Sept 17 (Reuters) - Emerging market shares slumped on Tuesday, led by losses in China after the central bank resisted temptation to lower its one-year lending rate and as investors were deterred by geopolitical concerns stemming from attacks on Saudi oil facilities.
MSCI’s emerging market stocks index snapped a four-day winning streak while the currency index was down 0.3%, turning negative for the first time in 10 sessions.
Both the Shanghai and the Chinese blue-chip index fell 1.7% after the People’s Bank of China (PBOC) kept a key money rate unchanged despite recent evidence of further downward pressure on the world’s second-largest economy.
“What wee see is more of a short-term reaction to that move as China is very aware of the weaknesses posed by the trade war (with the United States) and its economy,” said Danske Bank’s Jakob Christensen.
“They are taking a different route to support the economy by lowering the reserve requirements and also recently raising the possibility for local governments to extend debt.”
Markets still expect Beijing to step up stimulus on Friday by guiding benchmark rates lower for new loans.
Hong Kong shares registered their biggest daily decline in more than three weeks after Moody’s lowered its outlook for the city’s credit rating because of continuing public protests in the Asian financial hub.
Indian stocks slid for a second session on fears that a surge in crude prices after the attacks on Saudi oil facilities could hurt the economy further.
The rupee has lost more than 1% since the attacks, with central bank chief Shaktikanta Das saying the country’s current account and fiscal deficit could take a hit if oil prices continue to rise.
Although oil prices retreated on Tuesday, the market remains cautious over the threat of a military response to the Saudi oil attacks.
The Russian rouble, which made strong gains in the previous session, weakened 0.2% while stocks bucked the broader trend by rising 0.4%, boosted by shares in conglomerate Sistema after it announced a 3 billion rouble ($46.8 million) buyback programme.
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For RUSSIAN market report, see (Reporting by Agamoni Ghosh in Bengaluru Editing by David Goodman)