Emerging Stocks Rise on Economy as Sensex Jumps to RecordJulia Leite, Maria Levitov and Santanu Chakraborty
Emerging-market stocks rose to a six-week high as better-than-estimated U.S. jobless claims data bolstered confidence in the global economy. India’s S&P BSE Sensex climbed to a record amid a shrinking current-account gap.
The MSCI Emerging Markets Index advanced 1.2 percent to 970.27. India’s benchmark equity index rallied 1.1 percent as ICICI Bank Ltd. surged, while the rupee climbed to a three-month high. Brazil’s Ibovespa increased as MRV Engenharia e Participacoes SA led homebuilders higher. The Micex Index retreated as the U.S. threatened more sanctions if President Vladimir Putin doesn’t back off from the Ukrainian conflict while the Crimean parliament voted to become part of Russia.
Equities joined a global rally after data showed U.S. jobless claims tumbled, spurring optimism about the employment market before the Labor Department releases February payrolls data tomorrow. European Central Bank President Mario Draghi signaled that deflation risks in the euro region are easing.
“Investors might be getting a bit more comfortable,” Kevin Caron, a Florham Park, New Jersey-based market strategist at Stifel Nicolaus & Co., which oversees about $160 billion, said in a telephone interview today. “If data start to stabilize, that’s going to be good for overall demand, and that’s obviously a good thing for emerging markets.”
The iShares MSCI Emerging Markets Index exchange-traded fund advanced 1.4 percent to $40.03. The premium investors demand to own emerging-market debt over U.S. Treasuries dropped 0.05 percentage point to 310 basis points, according to JPMorgan Chase & Co.
Brazil’s Ibovespa led gains among major equity indexes in the Americas as MRV jumped 5.3 percent. Swap rates climbed after the central bank said that it would be appropriate to keep adjusting interest rates given persistent inflation.
The Micex Index dropped in Moscow as VTB Group, Russia’s second-biggest lender, sank 2.7 percent. The U.S. restricted visas for Ukrainian officials and others, including Russians, who it said were threatening the sovereignty of Ukraine. President Barack Obama also authorized the imposition of financial sanctions, clearing the way for escalating pressure.
India’s benchmark stock index rose to a record on optimism a shrinking current-account gap will bolster the rupee and spur overseas investors to increase their holdings of local equities. ICICI Bank climbed to a three-month high. China’s stock index rose for the first time in three days, led by developers, amid speculation the government won’t step up property curbs anytime soon.