Emerging-market stocks rose for the first time in four days as Samsung Electronics Co. led a surge in technology shares. Malaysia’s ringgit climbed to the highest level in four months amid deficit reduction measures.
The MSCI Emerging Markets Index added 0.7 percent to 1,034.38. Samsung, the biggest seller of smartphones, jumped 2.3 percent after two brokerages raised their share-price estimates. Petroleo Brasileiro SA (PETR3) climbed the most in seven months as the Brazilian state-run energy company said it’s asking the government to raise local fuel prices to international levels. The ringgit gained after Prime Minister Najib Razak announced a goods and services tax to help cut the fiscal deficit.
Nine out of 10 groups in the measure for developing-nation equities advanced, led by technology companies. The industry, which surged to the highest on record last week, is also driving gains in the broader gauge this month. Samsung is introducing software to help share content across devices, inviting developers to create more applications for its products.
The rally in technology shares “looks justified to me for the companies with the right business model and growth prospects,” said Michael Ganske, who helps manage $8.5 billion of developing-nation fixed-income and currencies as the head of emerging markets at Rogge Global Partners Plc in London.
The gauge for developing nations has climbed 4.8 percent in October, poised for a second monthly advance. It trades at 10.7 times projected earnings, compared with the valuation of 14.4 for the MSCI World Index.
The iShares MSCI Emerging Markets Index exchange-traded fund advanced 0.6 percent to $43. The Chicago Board Options Exchange Emerging Markets ETF Volatility Index, a measure of options prices on the fund and expectations of price swings, decreased 0.7 percent to 20.86.
Global investors are taking inordinate risks with emerging-market equities, and are “egregiously overweight” on consumer, Internet, telecommunications names, Bank of America Corp.’s Merrill Lynch said in an e-mailed note.
Brazil’s Ibovespa gained for the first time in four days as Petrobras jumped 7.6 percent. Chief Executive Officer Maria das Gracas Foster said in a Oct. 25 statement she’s seeking a fuel policy that brings local prices more into line with global levels.
Russian stocks rose to the highest level in a week as OAO Magnit, the nation’s largest retailer, posted record quarterly profitability after negotiating better terms with suppliers.
Samsung drove gains in the Kospi Index after Korea Investment increased its share-price estimate, saying third-quarter earnings showed competitiveness in the chip and phone industries. HI Investment also raised its stock forecast.
Most Chinese stocks fell as disappointing earnings at liquor and health-care companies offset gains for energy shares. Wuliangye Yibin Co. (000858), the nation’s second-largest liquor maker, and Yunnan Baiyao Group Co., a producer of Chinese medicine, slid at least 6.8 percent after reporting results.
The S&P BSE Sensex (SENSEX) lost 0.6 percent, dropping for a fifth day, ahead of the central bank’s policy meeting tomorrow. Reserve Bank of India Governor Raghuram Rajan, who vowed to quell price pressures when he took over at the central bank in September, will boost the repurchase rate by 25 basis points to 7.75 percent, 20 of 24 analysts said in a Bloomberg survey. State Bank of India fell for the first time in seven days.
Malaysia’s ringgit rose to the highest level since June. The government plans to introduce a 6 percent GST rate in April 2015 and is seeking to shrink the shortfall between revenue and spending to 3.5 percent of gross domestic product next year from 4 percent in 2013, Najib said in his annual budget on Oct. 25.
Egyptian stocks slid the most since August on concern the trial of former President Mohamed Mursi will trigger the return of political instability and after the benchmark jumped to the highest level in more than two years. Luxury property company Palm Hills Developments SAE tumbled 5.2 percent.
The premium investors demand to own emerging-market debt over U.S. Treasuries fell three basis points, or 0.03 percentage point, to 312 basis points, according to JPMorgan Chase & Co.
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