Emerging Market Stocks Post Weekly Gain as Russia, India Advance

Emerging-market stocks posted a weekly advance as OAO Gazprom led gains in Moscow and drugmakers pushed India’s benchmark higher, offsetting declines in Asian technology companies.

Gazprom, Russia’s state-controlled natural gas producer, rose for the first time in three days as investors bought shares to qualify for dividends. Ranbaxy (RBXY) Laboratories Ltd. jumped 5.2 percent in Mumbai after winning U.S. approval to make Novartis AG’s blood-pressure drug Diovan. Tata Consultancy Services climbed to a record. Samsung Electronics (005930) lost 1.1 percent, the largest drag in the MSCI Emerging Markets Index.

The developing-country gauge rose 0.3 percent this week to 1,047.01. It was little changed today. The measure has gained 5.3 percent since the beginning of April and is up 4.4 percent for the year. Asset managers have piled almost $11 billion into emerging-market exchange-traded funds listed in the U.S. this quarter, the most since 2012, data compiled by Bloomberg show.

“IT services and pharma are driving gains in India on good results from TCS and FDA approval for a new generic drug,” Michael Wang, an emerging-market strategist in London at Amiya Capital LLP, said by e-mail. “There’s been some profit taking in some Asian” technology companies.

The Micex Index gained 0.3 percent as Gazprom advanced 1.3 percent. The dividend cutoff for Gazprom, the heaviest-weighted stock on the benchmark is July 16. The ruble was little changed at 33.7254 per dollar.

Bulgaria Banks

Ranbaxy closed at the highest level since January 2013 as Indian drugmakers rose. Sun Pharmaceutical Industries Ltd., which agreed in April to purchase Ranbaxy, rallied 4 percent to a record. The S&P BSE Sensex Index ended a two-day loss.

The Sofix Index slid for a fourth day, retreating 0.7 percent after earlier dropping as much as 6.5 percent as Bulgaria’s central bank governor warned of an attack on the nation’s banks. CB First Investment Bank slid 24 percent, the most on record as volume climbed to more than 11 times the three-month daily average.

“There is an attempt to destabilize the state through an organized attack against Bulgarian banks in the past days, without any grounds,” central bank Governor Ivan Iskrov said in a live radio broadcast today. “The attack from yesterday is aimed at First Investment Bank. It is conducted through an epidemic of rumors and libelous public statements.”

The central bank bailed out Corporate Commercial Bank AD after Bulgaria’s fourth-largest lender ran out of funds and stopped operations a week ago. Its shares have been suspended since then. Iskrov said today the regulator would “use all its means and resources to guarantee people’s savings.”

Relative Value

The Ibovespa fell 0.7 percent in Sao Paulo as MMX Mineracao e Metalicos SA led a decline in commodity exporters, sinking 6 percent.

The BUX Index in Hungary climbed for the first time in four days and the Borsa Istanbul 100 Index added 0.5 percent.

The MSCI Emerging Markets Index has risen 4.4 percent this year and trades at 10.9 times projected 12-month earnings, compared with a multiple of 15.1 for the MSCI World Index of developed-country equities, which is up 4.8 percent in 2014, data compiled by Bloomberg show.

A Bloomberg index tracking 20 emerging-market currencies strengthened 0.2 percent. The premium investors demand to own developing-country debt over U.S. Treasuries declined one basis point to 265 basis points, according to JPMorgan Chase & Co. indexes.

Chinese Shares

The Hang Seng China Enterprises Index (HSCEI) of mainland companies traded in Hong Kong fell 0.3 percent, extending this week’s loss to 0.9 percent. China Pacific Insurance (Group) Co. fell the most in two months. The seven-day repurchase rate, a gauge of interbank funding availability, climbed for a second week as banks hoarded cash to meet quarter-end requirements.

Zoomlion Heavy Industry Science and Technology Co. fell 5.5 percent to a record in Hong Kong after Citigroup Inc. cut the stock’s rating to sell from buy.

Vietnam’s VN Index rose 0.4 percent after data showed the nation’s economic growth quickened in the second quarter. The Philippine Stock Exchange Index (PCOMP) retreated 0.7 percent, halting a five-day rally that sent the gauge into a bull market yesterday.

To contact the reporters on this story: Natasha Doff in London at ndoff@bloomberg.net; Ian Sayson in Manila at isayson@bloomberg.net

To contact the editors responsible for this story: Michael Patterson at mpatterson10@bloomberg.net Ash Kumar, Richard Richtmyer

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