Emerging Stocks Rise on China as Brazil Leads World Gains

Emerging-market stocks rebounded from a one-month low as an increase in Chinese exports lifted commodity producers from Vale SA to KGHM Polska Miedz SA. Brazil’s Ibovespa led gains among global equity indexes.

The MSCI Emerging Markets Index added 0.9 percent to 946.39. Vale, the world’s largest iron-ore maker, drove the Ibovespa to the biggest advance among 94 world stock gauges. Poland’s copper producer KGHM jumped the most in a month, while Magyar Telekom Nyrt. surged to a three-week high in Budapest after profit at the telecommunication-service provider beat estimates. Brazil’s real rebounded from a four-year low as 22 of 24 developing-nation currencies tracked by Bloomberg gained.

Stocks rose as data showed Chinese shipments overseas climbed 5.1 percent in July from a year earlier after sliding 3.1 percent in June. The fewest workers applied for U.S. unemployment benefits over the past month since before the last recession, indicating the labor market is making progress. The emerging-market gauge trimmed this year’s drop to 10 percent, compared with a 14 percent gain in the MSCI World Index.

“The Chinese economic transition is one of the biggest stories in emerging markets,” Stephen Wood, the New York-based chief market strategist who helps oversee about $237 billion at Russell Investments, said by phone. “China is stabilizing and growing. Some of the data are confirming that softer landing.”

Commodity shares led gains among nine of the 10 groups in the MSCI Emerging Markets Index. The iShares MSCI Emerging Markets Index exchange-traded fund added 1.9 percent to $39.28. The Chicago Board Options Exchange Emerging Markets ETF Volatility Index, a measure of options prices on the fund and expectations of price swings, retreated 1.2 percent to 23.06.

Brazilian Shares

Brazil’s Ibovespa rose 3.1 percent amid speculation the economy is improving in China, the nations’ top trading partner. Vale added 3 percent. The real climbed 1.3 percent after sinking to the lowest level since March 2009 yesterday.

Russian stocks dropped for the fifth day on speculation Bank Rossii will leave its main lending rates unchanged tomorrow as inflation remains above target. VTB Group, the nation’s second-biggest bank, fell 1.5 percent.

The Budapest Stock Exchange Index added 2.8 percent as Magyar, the Hungarian unit of Deutsche Telekom AG, rallied to the highest since July 18. Stocks in the Czech Republic and Poland advanced at least 1.1 percent. KGHM surged 3.6 percent.

China Vanke

Most Chinese stocks fell before the release of factory output and inflation data tomorrow. Losses for property developers and industrial companies overshadowed better-than-estimated trade data. China Vanke Co., the biggest developer, dropped 1.9 percent. Shenzhen Energy Group Co. slid the most in six weeks after it denied a newspaper report that a unit had set up an online brokerage with Tencent Holdings Ltd.

Indian stocks rallied the most since July 23 as some investors judged the recent declines that dragged the benchmark index to a six-week low was excessive. Ranbaxy Laboratories Ltd., the nation’s biggest drugmaker, jumped 28 percent as earnings signaled sales in the U.S. were improving.

The premium investors demand to own emerging-market debt over U.S. Treasuries fell 0.01 percentage point to 329 basis points, according to JPMorgan Chase & Co.

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