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Emerging Stocks Rise as Won Caps Longest Rally Since ’07

Emerging-market stocks rose, paring the first monthly drop since August, as Petroleo Brasileiro SA to Cnooc Ltd. drove gains in energy producers. South Korea’s won rose for a fifth month in the longest rally since 2007.

The MSCI Emerging Markets Index added 0.6 percent to 1,018.28, paring its November decline to 1.6 percent. A measure of energy companies advanced for the first time this week as Petrobras and Cnooc climbed more than 1.1 percent. The Borsa Istanbul National 100 Index led gains among major developing-nation gauges, while India’s S&P BSE Sensex rallied 1.3 percent. South Korea’s won increased amid economic optimism.

All 10 groups in the measure of developing-nation shares advanced as energy shares rallied after West Texas Intermediate crude rebounded from the lowest level in almost six months. Consumer-price gains in the euro area quickened this month and unemployment in the region declined in October, data today showed. U.S. markets were shut yesterday for a holiday and equity exchanges closed at 1 p.m. in New York today.

“A pickup in commodity prices is a huge positive for most emerging markets,” Timothy Ghriskey, the chief investment officer at Solaris Group LLC in New York, which manages over $1.5 billion, said by phone. “We have seen some improvement in some European data, so there’s hope that there’s some bottoming, and that would certainly be a positive.”

The iShares MSCI Emerging Markets Index exchange-traded fund rose 1 percent to $42.35. The Chicago Board Options Exchange Emerging Markets ETF Volatility Index, a measure of options prices on the fund and expectations of price swings, retreated 1.8 percent to 22.75.

Petrobras, Vale

Brazil’s Ibovespa advanced, paring its first monthly drop since June, with oil company Petrobras rising from a one-month low as board members meet to discuss an increase in fuel prices. Iron-ore producer Vale SA (VALE5) gained before a report due this weekend forecast to show manufacturing is still expanding in China, the company’s main export market. The real extended its biggest monthly slide since August.

The Micex Index posted the biggest monthly slump since May as OAO Mechel, Russia’s biggest producer of coal for steelmakers, tumbled. The Borsa Istanbul National 100 Index jumped 1.6 percent, while the Budapest Stock Exchange Index climbed for a third day.

India’s benchmark stock index rose, paring its first monthly decline since August, as State Bank of India climbed to a one-week high. The nation’s economic growth quickened last quarter from a four-year low on higher factory output, the Statistics Ministry said after the close of the market.

Chinese Stocks

China’s stocks capped monthly gains after the government announced the biggest package of policy changes since the 1990s. The Shanghai Composite Index climbed 3.7 percent in November after President Xi Jinping pledged to ease restrictions on private investment and the one-child policy. The Hang Seng China Enterprises Index (HSCEI) rallied 7.7 percent in Hong Kong this month, the most since December.

The won added 0.2 percent for the month and 0.3 percent today to 1,058.2 per dollar in Seoul, according to data compiled by Bloomberg. The country’s current-account surplus widened 45 percent to $9.5 billion in October, official data showed this week. The Bank of Korea said on Nov. 27 that growth momentum is picking up.

The rupiah led losses in emerging markets this month amid concern Indonesia’s current-account gap will leave the nation vulnerable to fund outflows when the U.S. cuts stimulus. Government bonds fell the most since 2011.

The premium investors demand to own emerging-market debt over U.S. Treasuries fell two basis points, or 0.02 percentage point, to 332 basis points, according to JPMorgan Chase & Co.

To contact the reporters on this story: Julia Leite in New York at jleite3@bloomberg.net; Santanu Chakraborty in Mumbai at schakrabor11@bloomberg.net

To contact the editor responsible for this story: Tal Barak Harif at tbarak@bloomberg.net

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