Emerging Stocks Rise, Paring Monthly Loss, as Ringgit Advances

Emerging Stocks Rise, Paring Monthly Loss, as Ringgit Advances
Business & Markets 2013
Written by Bloomberg
Friday, 30 August 2013 20:11

(Aug. 30): Emerging-market stocks rose, paring monthly losses, as prospects for an imminent strike against Syria diminished. The Malaysian ringgit headed for the biggest gain in two months, while equities in Russia and Poland fell.

Indonesian stocks led the advance as PT Global Mediacom jumped 17 percent after annoucing a share buyback plan. Samsung Electronics Co. rose for a sixth day, the longest winning streak since May 2012. Getin Noble Bank SA, the Polish lender controlled by billionaire Leszek Czarnecki, jumped the most in three weeks after profit beat estimates. The ringgit climbed 0.9 percent, the largest gain among emerging-market currencies.

The MSCI Emerging Markets Index rose 0.7 percent to 927.24 at 11:43 a.m. in London, paring this month’s drop to 2.1 percent. Investors withdrew about $44 billion from emerging- market stock and bond funds from the end of May through last week as economic growth cooled and amid speculation the U.S. Federal Reserve will reduce stimulus as soon as next month, according to data provider EPFR Global. Crude oil extended a drop from a two-year high after the U.K. parliament failed to back military action in Syria.

“Emerging Asian markets have gone through the wringer on concerns about the Fed removing stimulus and the unexpected escalation of tensions with Syria,” Kelly Teoh, a Singapore- based strategist at IG Asia Pte Ltd., said by e-mail today. “History would suggest recovery might not be too far away.”

Monthly Declines
All but one of the 10 industry groups in the MSCI Emerging Markets Index rose today, led by consumer and TECHNOLOGY [] shares. The gauge of developing nations trimmed this year’s plunge to 12 percent, compared with an 11 percent advance for a measure of developed markets.

The Jakarta Composite Index increased 2.2 percent. Indonesia’s measure and Thailand’s SET Index each tumbled 9 percent this month. The Philippine Composite Index advanced 2.2 percent today.

Global Mediacom rose the most since October 2010. GENTING BHD []. posted the biggest gain in a month in Kuala Lumpur after the company said it will pay a special cash dividend, its first since 2007, according to data compiled by Bloomberg. Samsung rallied 1.8 percent to its highest since June 19.

The ringgit strengthened the most since June 25 on a closing basis, trimming this month’s drop to 1.2 percent. Kumpulan Wang Persaraan (Diperbadankan), Malaysia’s second- biggest pension fund, said it has been a net buyer of the country’s stocks and bonds as foreign investors cut their holdings in Southeast Asia. The Russian ruble fell for fifth day against the dollar as West Texas Intermediate declined 0.9 percent to $107.86 a barrel, taking the two-day retreat to 2 percent.

India Data
Russia’s benchmark Micex Index lost 0.4 percent to a three- week low on a closing basis, while gauges in the Czech Republic and Latvia also dropped. Utility companies including OAO Russian Grids and OAO RusHydro decreased at least 2.8 percent. Poland’s WIG20 Index fell as much as 0.6 percent as the nation’s second- biggest oil company, Grupa Lotos SA, lost as much as 2 percent.

India’s S&P BSE Sensex rose 1.2 percent. Data today may show the economy slowed in the three months ended June after the central bank said this week it will sell dollars to oil importers to support the rupee. The currency appreciated for a second day after jumping the most in 27 years yesterday.

Tianjin Port Co. and Wuhu Port Storage & Transportation Co. jumped by the 10 percent daily limit in Shanghai, leading gains by Chinese marine and trading companies on speculation the government will allow free-trade zones in some cities. The Shanghai Composite Index rose 0.1 percent, taking its August advance to 5.3 percent, the biggest gain since May.

China Petroleum & Chemical Corp., also known as Sinopec, slid 1.8 percent to the lowest level in three weeks in Hong Kong after its parent agreed to buy Egyptian assets for $3.1 billion.