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Emerging-Market Stocks Advance to Three-Week High on Greek Aid

Nov. 27 (Bloomberg) -- Emerging-market stocks rose, sending the benchmark index to its highest level in almost three weeks, after easing of terms on emergency aid for Greece boosted appetite for riskier assets.

Hyundai Motor Co., which got 20 percent of its 2011 sales from Europe, gained the most in three weeks in Seoul. B2W Cia. Global do Varejo, Brazil’s biggest online retailer, jumped the most since Oct.1, as Bank of America Merrill Lynch recommended buying the shares. KGHM Polska Miedz SA, Poland’s best- performing stock in the benchmark index, snapped a three-day advance after Citigroup Inc. advised selling the shares. Unitech Ltd., a New Delhi-based real estate developer, rose 11 percent.

The MSCI Emerging Markets Index jumped 0.5 percent to 999.62 at 1:15 p.m. in London, heading for the highest close since Nov. 7. European finance ministers agreed to cut rates on Greece’s bailout loans, suspended interest payments for a decade and gave the nation more time for repayments. The 21 countries in MSCI’s developing-nations gauge send about 26 percent of their exports to the European Union on average, data from the World Trade Organization show.

“The agreement over Greece lifts away some of the concern that Europe’s crisis will worsen and it’s helping boost sentiment across regions,” Allan Yu, who helps manage about $10.26 billion at Metropolitan Bank & Trust Co., said in a telephone interview today.

Brazil’s Bovespa gained 0.7 percent. The BSE India Sensex 30 Index jumped 1.7 percent, the most in two months, as Moody’s Investors Service reiterated its stable outlook on the nation’s debt rating. The Shanghai Composite Index fell 1.3 percent, closing below 2,000 for the first time since 2009. Russia’s Micex Index fell 0.4 percent. The FTSE Bursa Malaysia KLCI Index slid 0.6 percent to its lowest close since June 28.

Trading Volumes

South Korea’s Kospi Index added 0.9 percent as Morgan Stanley said the gauge may jump 21 percent by the end of next year. The number of shares traded was 33 percent higher than the gauge’s 30-day average volume. Taiwan’s Taiex added 0.3 percent, with turnover above the average as Economic Daily News reported the nation’s regulators plan to ease rules on intraday trading.

China’s yuan strengthened 0.05 percent to 6.2223 per dollar, a 1 percent premium to the central bank’s daily fixing, the maximum it’s allowed to fluctuate, according to the China Foreign Exchange Trade System. South Korea’s won gained 0.1 percent against the dollar even as the government tightened curbs on the use of currency forwards.

Tax Payments

The ruble added 0.2 percent, appreciating for a third day versus the dollar as companies bought the currency to pay taxes. India’s rupee rebounded from a 2 1/2-month low against the dollar as Moody’s said the country’s Baa3 rating is supported by economic growth. The Philippine peso appreciated for a seventh day, its longest winning streak since January, on speculation Filipinos working overseas will send more money home as the year-end holidays approach.

The MSCI Emerging Markets Index has risen 9.1 percent this year, trailing a 10.2 percent gain by the MSCI World Index of developed countries. The gauge of developing-nation stocks trades at 11.5 times estimated earnings, compared with the MSCI World’s multiple of 13.2, data compiled by Bloomberg show.

B2W climbed 9.9 percent, the biggest gain in the Bovespa index. Bank of America raised the stock to buy from neutral.

KGHM, the best-performing shares in Poland’s WIG20 Index this year, slumped 1.8 percent. Citigroup cut the stock to sell from neutral, saying the shares are “overvalued.” KGHM has rallied 64 percent in 2012, compared with a 13 percent increase for the benchmark index.

Consumer Goods

Consumer-goods producers and industrial stocks rose the most among the 10 industry groups in the emerging-markets gauge. Hyundai Motor, South Korea’s largest automaker, gained 3.7 percent, the most since Nov. 6. Daelim Industrial Co. surged 7.8 percent, the biggest advance in 13 months.

Kumho Petro Chemical Co. jumped 8 percent in Seoul, the most since October 2011. A recovery in tire demand and the company’s capacity expansion for higher-margin products will boost earnings, KB Investment & Securities said in report today.

Unitech jumped 11 percent, the most since Oct. 11. Foreign investors have been buyers of local shares in India for all but one day this month, bringing net purchases this year to $19.2 billion. That’s the most among 10 Asian markets tracked by Bloomberg, excluding China.

China Rongsheng Heavy Industries Group Holdings Ltd. sank 6.7 percent in Hong Kong, the lowest since Oct. 19, while Glorious Property Holdings Ltd. fell 3.2 percent, its steepest loss in a month. Zhang Zhirong quit as chairman of both companies after an investment firm he controlled agreed to pay $14 million to resolve U.S. inside-trading claims.

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