Emerging Stocks Rise on China Data as Syria Concern EasesJulia Leite, Maria Levitov and Ian Sayson
Emerging-market stocks advanced to a three-month high as China’s industrial production data beat estimates and concern over a U.S.-led strike in Syria eased. India’s rupee capped the biggest four-day gain since 1973.
The MSCI Emerging Markets Index added 1.8 percent to 991.36. The iShares MSCI Emerging Markets Index exchange-traded fund capped the longest rally since 2004. Benchmark equity gauges from India to Turkey and South Africa rose at least 1.8 percent, while the Hang Seng China Enterprises Index entered a bull market. Dubai’s DFM General Index posted the biggest increase among world stock measures. The rupee led gains among the 24 developing-nation currencies tracked by Bloomberg.
Stocks in emerging markets advanced for a fifth straight day after data showed China’s industrial output grew at the fastest pace in 17 months in August and the broadest measure of new credit almost doubled from July. West Texas Intermediate crude tumbled as Syria agreed to a Russian plan to surrender its chemical weapons, easing concern of a U.S. strike.
“A real hard landing, a real crisis in China is not in the cards, at least not in the near term,” Derrick Irwin, a portfolio manager of the Wells Fargo Advantage Emerging Markets Equity Fund, said in an interview at Bloomberg headquarters in New York. His firm manages $223.8 billion. “When you see data like this, you get less worried.”
All 10 groups in the measure of developing-nation stocks rose today as health-care and financial shares had the biggest gains. The rally trimmed this year’s loss in the MSCI Emerging Markets Index’s to 6.1 percent, compared with a 14 percent increase in the MSCI World Index. The emerging-market gauge trades at 10.6 times projected earnings, trailing the 13.9 valuation of the MSCI World, data compiled by Bloomberg show.
The developing-nation ETF advanced 0.8 percent to $41.35, rising for a ninth consecutive day. The Chicago Board Options Exchange Emerging Markets ETF Volatility Index, a measure of options prices on the fund and expectations of price swings, fell 1.5 percent to 25.89.
Brazil’s Ibovespa fell for the first time in five days as data showing a measure of Brazilian inflation accelerated faster than forecast spurred bets policy makers will step up interest-rate increases. The real snapped three days of gains.
The Micex Index rose for a seventh day in the longest winning streak since April 2010 as metal producers surged. OAO Mechel, Russia’s largest producer of coal for steelmakers, climbed 6.1 percent. OAO Rosneft, the nation’s largest oil producer, fell 1.6 percent.
Oil futures fell 1.9 percent as France said it will submit a proposal to the United Nations to confiscate Syria’s chemical weapons. Bashar al-Assad’s government accepted the Russian plan. President Barack Obama told NBC News the motion is a “potentially positive development.” He will outline his intentions during speech at 9 p.m. in Washington.
Benchmark gauges in Turkey, Poland and the Czech Republic added more than 2 percent, while stocks in Hungary rebounded from a four-day plunge. The FTSE/JSE Africa All Shares Index rallied to a record high. Dubai’s DFM General Index climbed 8.5 percent, the biggest gain among 94 gauges monitored by Bloomberg globally. Egypt’s EGX 30 Index surged 3.1 percent.
China’s stocks rose, with trading volumes on the benchmark index jumping to the highest levels since October 2010. The Shanghai Composite Index rose 1.2 percent, the highest since June 6. The Hang Seng China Enterprises Index surged 21 percent from a June 25 low. Citic Securities Co., the nation’s biggest-listed brokerage, posted its biggest two-day gain in five years.
The S&P BSE Sensex rose 3.8 percent in Mumbai, the biggest gain since 2009, as trading resumed after a holiday. Bharti Airtel Ltd. jumped the most in three years after the regulator yesterday suggested cutting prices for auctioning airwaves. The rupee, which touched an all-time low of 68.845 on Aug. 28, advanced 6.1 percent in the four trading days through today, the biggest gain in data compiled by Bloomberg going back to 1973.
The Jakarta Composite Index capped the biggest rally since 2011, while the Philippine Stock Exchange Index jumped 1.6 percent. Stocks in Thailand and Malaysia also gained.
The premium investors demand to own emerging-market debt over U.S. Treasuries fell five basis points, or 0.05 percentage point, to 342 basis points, according to JPMorgan Chase & Co.