Emerging-market stocks rose the most in almost three weeks as limited international sanctions against Russia eased concern about a deeper standoff with President Vladimir Putin.
The MSCI Emerging Markets Index added 0.7 percent to 999.93. The Micex Index extended at two-day rally to 1.9 percent in Moscow. Brazil’s Ibovespa advanced as a poll showing President Dilma Rousseff losing voter support boosted state-run companies. The Shanghai Composite Index rebounded after briefly falling below the 2,000 level on speculation the government will stimulate the economy.
Russian stocks climbed for a second day as a new round of international sanctions bypassed major companies and banks. The U.S. yesterday imposed sanctions on seven Russian officials and 17 companies linked to Putin’s inner circle, saying Russia “has done nothing” to de-escalate the crisis in Ukraine. The EU added 15 names to its blacklist. A poll commissioned by Brazil’s National Transport Confederation showed support for Rousseff dropped to 37 percent from 43.7 percent in February.
“There’s lack of bad news,” Walter Todd, who oversees about $990 million as chief investment officer of Greenwood Capital Associates LLC in Greenwood, South Carolina, said by phone. “The developments in Russia and Ukraine are critically important for emerging markets. Brazil has been a painful trade for several years, and we may be getting close to a turn.”
The iShares MSCI Emerging Markets Index ETF added 1 percent to $41.41 The premium investors demand to own emerging-market debt over U.S. Treasuries fell 0.03 percentage point to 292 basis points, according to JPMorgan Chase & Co.
Gains in the Micex Index were led by OAO Lukoil, Russia’s second-largest oil producer, and OAO Magnit, the country’s biggest retailer. The ruble trimmed this year’s slide against the dollar to 7.8 percent.
The Ibovespa rose for the first time in three days in Sao Paulo as state-run companies including Centrais Eletricas Brasileiras SA and Petroleo Brasileiro SA jumped.
The Shanghai Composite Index advanced as SAIC Motor Corp., the nation’s biggest automaker, and retailer Shanghai Friendship Group Inc. drove a gauge of consumer companies most reliant on economic growth to the biggest advance among industry groups. The yuan fell to a 16-month low on speculation market activity was slower than usual before public holidays.
The won rose to the strongest level since 2008 after South Korea said its current-account surplus widened last month and before data forecast to show export growth accelerated in April.