Related News:
Emerging-Market Stocks Rise for Sixth Day on Outlook for Economic Growth
Emerging-market stocks climbed for a sixth day and currencies strengthened as bank earnings topped analysts’ estimates and a better-than-projected U.S. home sales report bolstered confidence in the global economy.
The MSCI Emerging Markets Index advanced 0.6 percent to 991.04 at 5:26 p.m. in New York and traded as high as 995.33, the highest intraday level since May 4. India’s rupee appreciated 0.8 percent against the dollar after the central bank raised its reverse repurchase rate more than economists estimated.
Emerging market stocks reduced gains after confidence among U.S. consumers declined in July to a five-month low, a sign the lack of jobs will limit the economy’s recovery.
Asian stock markets rose after the U.S. Commerce Department said yesterday that sales of new homes increased to an annual pace of 330,000, topping the 310,000 median estimate of economists in a Bloomberg survey. East European banks including Budapest-based OTP Bank Nyrt. advanced as second-quarter profits at UBS AG and Deutsche Bank AG topped analysts’ projections.
“The emerging markets including the BRICs have a better outlook,” said Cynthia Steer, the chief research strategist at Darien, Connecticut-based CRA Rogerscasey, referring to the largest emerging markets of Brazil, Russia, India and China.
Developing-nation economies will expand 6.8 percent as a group this year, more than double the 2.6 percent pace for advanced countries, according to estimates from the Washington- based International Monetary Fund. The MSCI emerging index has climbed 0.2 percent this year, compared with a 3.2 percent drop in the MSCI World Index.
Bovespa Climbs for Seventh Day
Brazil’s Bovespa stock index advanced for a seventh day, the longest winning streak this year, as investors speculated interest rates will rise more slowly and bank lending expanded.
The Bovespa rose 0.4 percent to 66,674.44 at the close of trading in Sao Paulo at 4 p.m. New York time. Retailer Lojas Renner SA and cosmetics maker Natura Cosmeticos SA surged as Brazil’s traders reduced bets for higher borrowing costs, boosting the outlook for credit demand. Tele Norte Leste Participacoes SA rallied amid speculation Portugal Telecom SGPS SA will buy a stake in the firm, known as Oi.
Rupee Rally
Russia’s Micex Index and India’s Bombay Stock Exchange Sensitive Index increased 0.3 percent. China’s Shanghai Composite Index slipped 0.5 percent amid concern banks may face losses on loans to local governments.
The rupee strengthened the most since June 21. India’s domestic economic recovery is firmly in place and is strengthening, central bank Governor Duvvuri Subbarao said in a statement after raising the key reverse repurchase rate to 4.5 percent from 4 percent. The median forecast in a Bloomberg News survey was for a quarter-point increase.
The Hungarian forint led gains in emerging-market currencies after the government sold 50 billion forint ($230 million) of three-month Treasury bills, 5 billion forint more than planned. Investors submitted bids worth 133.3 billion forint, according to auction results on the debt management agency’s Bloomberg page.
Turkey’s ISE National 100 Index increased 1.4 percent to a record high after the nation’s central bank reduced its year-end inflation forecast and U.K. Prime Minister David Cameron called on other European Union nations to drop their objections to Turkey’s joining the 27-nation bloc.
To contact the reporter on this story: Michael Patterson in London at mpatterson10@bloomberg.net. Shiyin Chen in Singapore at schen37@bloomberg.net
Rate These Stories
Rate this Page