Emerging Stocks Rise on U.S. as Commodity Shares Rally

Emerging stocks rose, posting the biggest weekly advance since January, as better-than-forecast U.S. jobs data bolstered optimism about global economic growth. Commodity companies paced rallies from Russia to Brazil.

Vale SA, the third-largest mining company, added 1.4 percent in Sao Paulo, while natural gas producer OAO Gazprom led gains in Moscow. Philippine (PCOMP) stocks surged to a record as the nation won its second investment-grade debt rating, Turkey’s benchmark index gained a ninth day, and Malaysian shares sank before elections. African Bank Investments (ABL) Ltd. fell the most since 1998 in Johannesburg after saying profit will drop.

The MSCI Emerging Markets Index rose 0.5 percent to 1,042.26 in New York, extending a weekly gain to 2 percent. Stocks climbed as data showed U.S. employment picked up more than forecast last month and the jobless rate unexpectedly declined to a four-year low. The Dow Jones Industrial Average briefly advanced above 15,000 for the first time.

“The market needed a good jobs report and we got it,” Alan Gayle, senior strategist at RidgeWorth Capital Management, said by phone from Atlanta. His firm oversees about $48 billion. “U.S. growth is proceeding and that’s going to provide a lift to global stocks, including emerging markets.”

All 10 groups in the emerging-market index rose today as commodity gauges added at least 0.8 percent. The broad gauge has lost 1.2 percent this year, compared with an 11 percent increase in the MSCI World Index of developed-country stocks. The emerging-markets measure trades at 10.9 times 12-month projected profit, compared with the MSCI World’s 14.4 times, according to data compiled by Bloomberg.

Emerging ETF

The iShares MSCI Emerging Markets Index exchange-traded fund gained 0.8 percent to $43.52. The Chicago Board Options Exchange Emerging Markets ETF Volatility Index, a measure of options prices on the fund and expectations of price swings, lost 5.7 percent to 18.19.

Brazil’s Ibovespa (IBOV) rose 0.3 percent today, extending its weekly rally to 2.3 percent, as Vale led gains by raw-material producers after commodities prices jumped. Mexico’s IPC Index climbed the most since April 23.

Russia’s Micex Index (INDEXCF) jumped 2.3 percent as Gazprom contributed the most to the advance in the measure of developing nations. Benchmark gauges in Hungary and the Czech Republic gained, while stocks in Poland retreated. Turkish stocks extended a nine-day rally to 7.3 percent.

South Africa

South African lenders offering unsecured credit plunged as African Bank Investments, the nation’s largest provider of loans not backed by assets, plunged 18 percent.

China’s stocks rose as Poly Real Estate Group Co. and Haitong Securities Co. advanced at least 1.4 percent. The Shanghai Composite Index jumped 1.4 percent, while the Hang Seng China Enterprises Index of mainland Chinese companies listed in Hong Kong rose 0.2 percent.

South Korea’s Kospi Index added 0.4 percent. Mando Corp. (060980), which makes automotive parts, surged 11 percent in Seoul, leading gains in the emerging-markets index.

Indian stocks fell from a three-month high, paring a weekly gain, as the central bank said there’s “little space” for further monetary easing after cutting interest rates for a third straight policy meeting.

The benchmark Philippine Stock Exchange Index advanced 1.7 percent in Manila. The FTSE Bursa Malaysia KLCI Index sank 1.1 percent, the most since Feb. 6.

The extra yield investors demand to own emerging-market debt over U.S. Treasuries dropped ten basis points, or 0.1 percentage point, to 268 basis points, according to JPMorgan’s EMBI Global Diversified Index.

To contact the reporters on this story: Julia Leite in New York at jleite3@bloomberg.net; Lyubov Pronina in London at lpronina@bloomberg.net

To contact the editors responsible for this story: Emma O’Brien at eobrien6@bloomberg.net; Gavin Serkin at gserkin@bloomberg.net

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