Emerging stocks set for best quarter since ’12 as oil drops

Emerging-market stocks rose, extending the biggest quarterly advance since September 2012, and shares in Europe rebounded from earlier losses. Oil fell as continuing violence in Iraq failed to disrupt supply.

The MSCI Emerging Markets climbed 0.4 percent at 8:27am in New York. The Stoxx Europe 600 Index added less than 0.1 percent and Standard & Poor’s 500 Index futures were little changed, with the US benchmark poised for the longest stretch of quarterly gains in 16 years.

Bulgarian stocks rallied from a five-month low while Dubai shares extended a bear market. Brent crude declined 0.7 percent. Portugal’s 10-year bond yield rose eight basis points to 3.65 percent. Norway’s krone slid to its weakest level since February against the euro.

A gauge of world equities is heading for a fifth straight monthly advance, the longest streak since 2007, amid signs of economic revival and speculation the US won’t increase interest rates anytime soon.

Pending home sales in America probably picked up in May, economists said before a report today. Sectarian fighting in Iraq hasn’t spread to the south, home to more than three-quarters of the nation’s oil production.

“The global outlook is improving,” Ang Kok Heng, chief investment officer of Phillip Capital Management Sdn., which manages $428 million, said. “Low interest rates will still be the catalyst.”

The MSCI Emerging Markets Index has climbed 5.6 percent this quarter. India’s S&P BSE Sensex index advanced 1.3 percent today, jumping 14 percent this quarter as investor optimism over the new government lured overseas funds. The Shanghai Composite Index rose 0.6 percent, capping the first quarterly gain since the period ended in September.

Brent dropped to $112.54 a barrel. Corn retreated 0.9 percent, extending the decline this quarter to 12 percent on record US production.

Iraq’s oil minister said last week the nation’s crude exports will accelerate next month, adding to signs that violence in the country’s north isn’t affecting the oil-rich south.