Emerging stocks rose for a second day after protesters in Hong Kong began talks with the government. Russian stocks climbed after their biggest weekly drop since July, while South Africa’s rand jumped against the dollar.
The MSCI Emerging Markets Index gained 0.6% to 1,003.25 at 1:53 p.m. in London. The Micex Index increased the most since Sept. 3 in Moscow, led by OAO Sberbank, after last week losing 3.5%. Agricultural Bank of China Ltd. advanced the most in a month in Hong Kong. The rand (CME:T6Z14) strengthened 0.6% as Lesetja Kganyago was named central bank governor.
The developing-nation stock gauge, which fell to a six-month low on Oct. 2, headed for its first two-day gain in more than a month. Pro-democracy protesters in Hong Kong allowed civil servants to enter government offices as demonstrations that paralyzed parts of the city for 10 days thinned after the start of talks with student leaders. The Hang Seng China Enterprises Index rose 0.6%.
“It looks like protests in Hong Kong are dissipating, which is good for sentiment,” Neil Shearing, chief emerging- markets economist at Capital Economics Ltd. said by phone from London. “It’s no surprise that the weaker performers over the past month, such as Russia, have seen the biggest rebound.”
All 10 industry groups in the MSCI emerging-market gauge advanced, led by energy and consumer discretionary stocks. The measure trades at 10.8 times its projected 12-month earnings, while the MSCI World Index of developed-nation equities is valued at a multiple of 14.7 times.
Stock markets in China, India, Malaysia, the United Arab Emirates, Qatar and the Philippines are closed for holidays.
Russia’s Micex Index climbed 2.4% as Sberbank headed for its steepest increase in more than a month. The ruble (CME:R6X14), which last week depreciated 2%, strengthened 0.2%. Equity markets in Turkey and Hungary added at least 0.7%, while the WIG20 Index jumped 0.7% in Warsaw.
The monetary policy council will meet for two days starting Oct. 7 and is set to cut Poland’s key rate by 25 basis points to 2.25%, according to the median estimate of 34 economists in a Bloomberg survey. The zloty (CME:WPZ14) strengthened 0.1% against the euro (CME:E6Z14).
The rand appreciated to 11.2710 versus the dollar (NYBOT:DXZ14) after South African President Jacob Zuma picked Kganyago, the former director-general of the National Treasury who joined the Reserve Bank as a deputy governor in 2011, as successor to Governor Gill Marcus. The FTSE/JSE Africa All Share Index climbed 1.4%.
The Hang Seng China Enterprises Index of Chinese companies listed in Hong Kong advanced for a second day. Agricultural Bank of China Ltd., the nation’s third-largest lender, rose 1.2%, while Citic Securities Co. gained 2.5%.
Civil servants poured back into offices today after students removed some barricades in response to an ultimatum from the city’s leader to restore access or face possible police action. Protesters numbered in the dozens at the three main sites, with leaders saying they would ramp the demonstrations back up without concessions on their demands for freer elections.
Hyundai Merchant Marine Co., which owns part of a tour operator in a North Korean resort, led the advance in the MSCI emerging-nation stock gauge in percentage terms. South Korean President Park Geun Hye’s top security adviser met his North Korean counterpart for the first time and agreed to push for improved relations.
Bangkok Bank lost 2.7%, the sharpest decline in five months, while Airports of Thailand Pcl slid 3.4%. The SET Index decreased 1.7%, its steepest retreat since January, extending last week’s drop.
Thailand’s King Bhumibol Adulyadej, the world’s longest-reigning monarch, had a successful operation to remove his gall bladder, the Office of His Majesty’s Principal Private Secretary said in a statement today.
The 86-year-old king has served as head of state through 16 successful or attempted coups, 17 constitutions and 29 changes of prime minister. He endorsed Prayuth Chan-Ocha, the army chief who toppled the elected government in May, as the nation’s prime minister on Aug. 24.
The premium investors demand to own emerging-market debt over U.S. Treasuries narrowed one basis point to 301, JPMorgan Chase & Co. indexes show.
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