Emerging-Market Stocks Rise on U.S. as Turkey Leads Gains

Emerging-market stocks rallied the most in two months after a better-than-estimated American jobless-claims report bolstered optimism about global economic growth. Turkish shares drove gains in world equities.

The MSCI Emerging Markets Index climbed 1.4 percent to 929.80. The Borsa Istanbul 100 Index of stocks surged 3.4 percent, while the lira rallied as banks offered the highest rate on savings after a doubling of central bank rates last month. Brazil’s Ibovespa advanced 2.4 percent as Vale SA (VALE) paced gains in commodity producers. Hong Kong stocks rebounded from the lowest level in six months as casino operators rallied.

Stocks advanced after a government report showed that applications for U.S. unemployment benefits fell for the first time in three weeks as employers retained workers to meet demand. A pickup in the pace of hiring and wage growth would help fuel bigger gains in the consumer spending that accounts for almost 70 percent of the world’s largest economy.

“That’s another indication that the labor market is improving,” Bruce McCain, who helps oversee more than $20 billion as chief investment strategist at the private-banking unit of KeyCorp in Cleveland, said by phone. “The improvement in the labor market adds confidence in the U.S.”

Emerging ETF

The iShares MSCI Emerging Markets Index exchange-traded fund added 2.1 percent to $38.51. The Chicago Board Options Exchange Emerging Markets ETF Volatility Index, a measure of options prices on the fund and expectations of price swings, retreated 6.7 percent to 27.26.

Brazil’s Ibovespa climbed the most since September as commodities gained, lifting Brazilian raw-material producers including mining company Vale SA. (VALE5) The shorter-term swap rates climbed as President Dilma Rousseff’s plan to reiterate her commitment to slowing inflation added to speculation that the central bank will sustain increases in borrowing costs.

Russian stocks gained for a second day as consumer shares rose and the ruble extended its advance the day before the start of the Winter Olympics in Sochi. OAO M.video, the nation’s biggest electronics retailer, rose 1.2 percent. OAO Aeroflot, the nation’s largest airline, increased 3.5 percent.

The Borsa Istanbul 100 Index of stocks jumped the most since Dec. 30 as Turkiye Garanti Bankasi AS (GARAN) drove gains in lenders. The three-month deposit rate offered by Turkish banks was at 11.10 percent today, equal to the highest since June 2012 and the most among developing nations after Argentina, according to data compiled by Bloomberg.

Coal India

Indian stocks rose, led by materials producers and consumer companies, as the benchmark index gained for a third day amid increases in emerging-market equities. Coal India Ltd. (COAL) jumped the most in four months. Hindustan Unilever Ltd. had the biggest gain in five months and cigarette maker ITC Ltd., which has the highest weighting on the S&P BSE Sensex (SENSEX), posted the steepest climb in a month.

The Hang Seng Index (HSI) rebounded from the lowest level since July 10. Sands China Ltd. (1928), a unit of billionaire Sheldon Adelson’s Las Vegas gaming company, led gains on the Hang Seng Index after tumbling yesterday by the most since October 2011 amid a slump in Macau’s gambling revenue. China Shenhua Energy Co., the nation’s biggest coal producer, jumped 5.8 percent, paring this year’s loss to 16 percent. Lenovo Group Ltd. slid 2.4 percent as Nomura Holdings Inc. downgraded the shares.

The premium investors demand to own emerging-market debt over U.S. Treasuries fell six basis points, or 0.06 percentage point, to 343 basis points, according to JPMorgan Chase & Co.

To contact the reporters on this story: Elena Popina in New York at epopina@bloomberg.net; Maria Levitov in London at mlevitov@bloomberg.net; Harry Suhartono in Jakarta at hsuhartono@bloomberg.net

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

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