Emerging-Market Stocks Post Weekly Gain on U.S. Job Data

Emerging-market stocks posted the biggest weekly gain in a month as U.S. jobs data bolstered the outlook for exports from developing nations. Erste Group Bank AG (EBS) plunged in Prague after saying it will post a loss.

The MSCI Emerging Markets Index was little changed today in New York, leaving it up 1.6 percent for the week. Steelmaker Usinas Siderurgicas de Minas Gerais SA rose for a fourth day in Sao Paulo, capping the best week in almost a year. Erste Group Bank tumbled 16 percent after forecasting a record loss. Russia’s ruble was the worst performer against the dollar among developing-nation currencies.

Data yesterday showed growth in U.S. payrolls exceeded economist estimates and the unemployment rate fell to the lowest level since before the peak of the financial crisis six years ago. The report added to optimism on the global economy after data on July 1 showed China’s manufacturing expanded in June at the fastest pace this year. The U.S. stock market is closed for a holiday.

“The gains in emerging markets are a follow-through from the strong performance of the U.S. yesterday,” John Lomax, an emerging-market strategist at HSBC Holdings Plc, said by phone from London. “The jobs numbers were well received and there is no sign that the Federal Reserve will tighten earlier than expected, which is the big risk for EM equities.”

The Ibovespa rose on a session that ended 2 1/2 hours earlier than usual, before Brazil’s World Cup game. Usiminas rose 1.2 percent, pushing a weekly advance to 11 percent.

Erste Group

OTP Bank Nyrt., Hungary’s largest lender, sank as the parliament passed a law that requires a refund of consumer-loan related charges deemed unfair.

Shares of Erste Group Bank, the second-largest lender by assets in Hungary after OTP, slumped after the company said it will incur a loss of as much as 1.6 billion euros ($2.2 billion) this year on account of its Hungarian and Romanian units.

The ruble weakened as investors sold higher-yielding emerging market currencies in favor of the dollar on signs the U.S. labor market is recovering.

Vestel Elektronik Sanayi ve Ticaret AS (VESTL) surged to the highest level since 2007 in Istanbul after a report that Sharp Corp. may transfer European home appliance sales to the company.

The Hang Seng China Enterprises Index of mainland companies listed in Hong Kong rose 0.3 percent, while shares in Shanghai slipped 0.2 percent, falling for the first time in five days. Shimao Property Holdings Ltd. (813) led gains among Chinese property developers.

The main Philippine equity gauge climbed to the highest level since May 2013 after data today showed inflation slowed in June.

To contact the reporters on this story: Natasha Doff in London at ndoff@bloomberg.net; Julia Leite in New York at jleite3@bloomberg.net

To contact the editors responsible for this story: Michael Patterson at mpatterson10@bloomberg.net; Daliah Merzaban at dmerzaban@bloomberg.net Marie-France Han

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