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Erste Jumps Most in Eight Months on Fed Stimulus: Prague Mover

Sept. 14 (Bloomberg) -- Erste Group Bank AG jumped the most in almost eight months, leading the Czech stock index to its highest in almost six months after the U.S. Federal Reserve pledged to keep stimulating the world’s largest economy.

The Austrian lender’s shares rose 7.5 percent to 469 koruna by 2:27 p.m. in Prague, their steepest intraday advance since Jan. 26. The PX gauge, where Erste has a 23 percent weighting, added 2.3 percent, heading for its highest close since March 28.

Stocks and commodities surged around the world after the Fed said it will expand holdings of long-term bonds with open-ended purchases of $40 billion of mortgage debt a month and hold the federal funds rate near zero until at least the middle of 2015, boosting investors’ demand for riskier assets.

“The market has been surprised by both the volume of the intervention and its basically unlimited duration,” Miroslav Adamkovic, a stock analyst at Komercni Banka AS in Prague, wrote in an e-mailed report to clients today.

New World Resources Plc, the biggest Czech producer of coking coal, climbed 4.8 percent to 92.75 koruna, headed for its biggest rally in three months. More than 1.3 million shares have changed hands so far today, almost seven times the three-month daily average and the biggest turnover in the PX index.

To contact the reporter on this story: Krystof Chamonikolas in Prague at kchamonikola@bloomberg.net

To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net

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