Emerging Stocks Decline Led by Samsung as Sensex Tumbles

Emerging-market stocks fell, capping a second weekly decline, as Samsung Electronics Co. paced a slump in technology companies. India’s S&P BSE Sensex dropped amid concern the central bank will raise interest rates.

The MSCI Emerging Markets Index slipped 0.1 percent to 990.48, extending its weekly retreat to 1.2 percent. Samsung Electronics, Asia’s largest technology company and the world’s biggest maker of mobile phones, declined 1.4 percent. ICICI Bank Ltd., India’s second-biggest lender, decreased the most in almost 12 weeks. Brazil’s Ibovespa fell, extending a fourth straight weekly drop, as Vale SA (VALE5) followed commodities prices lower. Indonesia’s rupiah drove losses among currencies.

Equities joined a drop in global stocks as signs of improvement in the U.S. economy spurred concern the Federal Reserve will cut stimulus next week. The gauge for stocks in developing nations has slid as much as 16 percent since May 22, when the U.S. central bank signaled its asset-buying program could be trimmed if the economy showed sustained improvement.

“The tapering scenario is the main issue, but for EM stocks there’s also slowing economies and earnings growth that isn’t very strong,” Mark Perrin, who helps manage $3.5 billion in emerging-market equities at F&C Asset Management Plc in London, said by e-mail.

A measure of technology shares led declines among 10 industries as Samsung slid to a two-month low. The iShares MSCI Emerging Markets Index exchange-traded fund rose 0.2 percent to $40.95. The Chicago Board Options Exchange Emerging Markets ETF Volatility Index, a measure of options prices on the fund and expectations of price swings, declined 1.1 percent to 25.33.

Brazil, Russia

Brazil’s Ibovespa declined 0.1 percent after earlier gaining as much as 0.8 percent. Vale, the world’s biggest iron-ore producer, sank to the lowest level since Nov. 27. Online retailer B2W Cia. Digital was the best performer on the stock index after Banco Santander SA (SAN) raised its rating to hold.

Russian shares rose, capping a weekly advance, as funds focused on the nation’s stocks reported inflows and OAO Aeroflot jumped to the highest since March 2011. Oil pipeline monopoly OAO Transneft and regional crude producer OAO Bashneft both surged 2.4 percent after HSBC Holdings Plc recommended buying the stock.

China’s benchmark stock index fell for a fourth day, capping a weekly decline, before the government announces economic growth targets for next year. China Oilfield Services Ltd. (601088) and ZTE Corp. dropped at least 1 percent, leading energy and phone stocks to the biggest declines among industry groups. Cosco Shipping Co., a unit of the biggest shipping group, rose as a benchmark of commodity shipping rates climbed a 14th day.

Central Bank

Indian stocks fell, with the benchmark gauge having its steepest weekly loss in a month, as faster-than-estimated inflation sparked expectations the central bank will raise interest rates in the coming week. ICICI Bank tumbled 4.2 percent, while State Bank of India, the nation’s biggest lender, dropped 1.9 percent.

The rupiah fell 1.3 percent from Dec. 6 to 12,118 per dollar as of 4:13 p.m. in Jakarta, taking its drop since the end of October to 7 percent, data compiled by Bloomberg show. It touched 12,122 earlier, the weakest level since March 2009.

The premium investors demand to own emerging-market debt over U.S. Treasuries fell two basis points, or 0.02 percentage point, to 322 basis points, according to JPMorgan Chase & Co.

To contact the reporters on this story: Anuchit Nguyen in Bangkok at anguyen@bloomberg.net; Zahra Hankir in London at zhankir@bloomberg.net

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

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