Emerging stocks reach 2-week high

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Johannesburg - Emerging-market stocks rose to a two- week high as China’s trade data topped estimates and the Federal Reserve signaled the US still needs stimulus.

The ruble fell as Ukraine separatists said they’re pushing ahead with a vote.

The Hang Seng China Enterprises Index rebounded from a six-week low as PetroChina Co. advanced.

South Africa’s rand climbed to a four-month high after initial election results showed the ruling African National Congress is on course to extend its 20-year rule.

Vietnam’s VN Index slumped the most since 2001 amid escalating tension with China.

The ruble weakened for the first time in four days, erasing earlier gains.

The MSCI Emerging Markets Index added 0.6 percent to 1,010.36 by 2:07 p.m. in London.

Data today showed China’s exports and imports unexpectedly rose in April, helping leaders put a floor under a slowdown in the world’s second-biggest economy.

Fed Chair Janet Yellen told US lawmakers the central bank will keep rates near zero for a “considerable time” after ending monetary stimulus.

“The key driver on emerging markets in general is Yellen’s comments overnight on US monetary policy,” John Lomax, an emerging-market strategist at HSBC Holdings Plc, said by phone from London.

“That’s lifting the asset class as a whole. We had slightly better trade numbers out of China, which helped the Chinese equity market.”

 

Ruble Weakens

 

All 10 industry groups in the developing-nation measure advanced, led by phone and financial companies.

The UX Index of equities in Ukraine rose 0.1 percent, after jumping as much as 1.7 percent.

The hryvnia strengthened 0.5 percent before giving up its advance and trading down 0.3 percent to 11.655 per dollar.

The Micex rose less than 0.1 percent in Moscow.

The ruble weakened against the central bank’s target euro-dollar basket, depreciating 0.5 percent.

Ukraine’s Donetsk region won’t delay a May 11 referendum, Aleksandr Maltsev, a spokesman for the so-called Donetsk People’s Republic, said by phone.

President Vladimir Putin yesterday softened his rhetoric on Ukraine, urging separatists to postpone the vote on regional autonomy while pledging to pullback troops from Ukraine’s border.

The North Atlantic Treaty Organization said there’s no sign of any Russian withdrawal from the frontier.

“We saw a bounce yesterday on the back of hopes of a de-escalation and that’s being partially reviewed this morning,” Lomax said.

“Even if some kind of settlement is reached there will be a long-term change in perceptions toward Russia, which have scope to potentially increase the political discount in the market.”

 

South Africa Elections

 

The FTSE/JSE Africa All Share Index increased for a second day in Johannesburg, rising 0.1 percent, and the rand appreciated 0.9 percent versus the dollar.

With ballots counted in 53.7 percent of the 22,263 voting districts, the ANC’s support stood at 62.9 percent, according to provisional figures released by the Independent Electoral Commission.

Turkey’s benchmark gauge rose to the highest level since December 2, increasing 1.4 percent.

Industrial production rose by a better-than-expected 4.2 percent in March, data showed today.

State-run Turkiye Vakiflar Bankasi TAO climbed 0.9 percent after reporting a first-quarter profit that beat analyst estimates.

The WIG30 Index rose 0.2 percent in Warsaw.

Hungary’s forint headed for the strongest level since January 28 as industrial production rose 8.1 percent in March.

The premium investors demand to own emerging-market debt over US Treasuries fell two basis points to 282, according to JPMorgan Chase & Co. indexes.

 

China Exports

 

The emerging-markets gauge rose 0.7 percent this year and trades at 10.5 times projected 12-month earnings, data compiled by Bloomberg show.

The MSCI World Index gained 1.6 percent in 2014, taking its valuation multiple to 14.8.

The Hang Seng China Enterprises Index of mainland companies listed in Hong Kong advanced 0.8 percent, halting a two-day loss.

PetroChina, the country’s biggest oil and gas producer, rose 1.7 percent, the steepest increase in more than a week.

The Shanghai Composite Index climbed 0.3 percent, the most this week.

China’s overseas shipments added 0.9 percent from a year earlier, while imports rose 0.8 percent, official data showed.

Vietnam’s VN Index slumped 5.9 percent.

The measure has tumbled 13 percent from this year’s peak on March 24 amid growing tension with China over disputed waters and speculation that leveraged traders are liquidating positions.

The gauge has wiped out most of the 20 percent advance through its March high that had made the gauge this year’s top performer in Asia.

Thailand’s SET Index sank the most since January 27 and the baht lost 0.4 percent on concern global investors will shun the country after a court ruling to remove Yingluck Shinawatra as prime minister threatened to prolong a political crisis. - Bloomberg News



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