• Monday, July 15, 2024
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BusinessDay

Emerging-market stocks set for longest gain

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Emerging-market stocks rose for an eighth day last Tuesday, the longest rally in 15 months, as an increase in U.S. manufacturing bolstered confidence in global growth and concern eased that the crisis in Ukraine would escalate.

The MSCI Emerging Markets Index added 0.5 percent to 999.09. Russia’s Micex Index erased losses, while Ukraine’s UX Index extended a two-day rally to 8.6 percent. India’s S&P BSE Sensex (SENSEX) jumped to a record, led by industrials and software exporters, after changing direction 24 times.

Brazil’s Ibovespa (IBOV) posted the biggest decline among major developing-nation stock gauges as inflation accelerated.

Brazil’s Ibovespa sank amid speculation a two-week surge that pushed Brazilian stock valuations to the highest since January was excessive.

“We are muddling along with positive growth,” James W. Gaul, a portfolio manager at Boston A dvisors LLC, which oversees about $2.6 billion from Boston said. “That is a good thing. Sentiment had been negative for so long, that we could simply be getting a bit of a relief rally.”

The iShares MSCI Emerging Markets Index exchange-traded fund advanced 0.9 percent to $41.38, rising for the ninth day. The premium investors demand to own emerging-market debt over U.S. Treasuries slipped 0.04 percentage point to 292 basis points, according to JPMorgan Chase & Co.

Emerging market equities rose after data showed U.S. manufacturing expanded at a faster pace in March amid gains in production and orders.

German Chancellor Angela Merkel spoke to Russian President Vladimir Putin last Monday and said he had ordered a partial withdrawal from Ukraine’s borders. The North Atlantic Treaty Organisation said it will recommit to defending frontline states in eastern Europe that have been unsettled by the seizure of Crimea as the alliance reported no signs of a Russian pullback.