Kuala Lumpur: Emerging-market stocks rose for the sixth day, sending the key index to a 20-month high, as a drop in the US unemployment claims and a report today that’s expected to show job addition fuelled optimism of a global recovery.
The MSCI Emerging Markets Index climbed 0.2% to 1,029.53 at 11:33 am in London, with the 22-country gauge heading for the highest close since 1 August 2008. The measure has risen 3.7% this week, and the six-day gain is the longest winning streak since November.
“The good performance in emerging markets is a reflection of the confidence of the US economy,” said Choo Swee Kee, who manages around $202 million of assets as chief investment officer at TA Investment Management Berhad in Kuala Lumpur. “We do expect more recovery news from the US to come in, so if the US continues to be positive, it will continue to give more direction?for the emerging markets.”
The US reported a drop in unemployment benefit claims and growth in manufacturing. Fewer Americans filed for jobless benefits last week, bringing the average over the past month to the lowest level since 2008, according to data from the labour department.
The Institute for Supply Management’s factory index also rose to the highest level since July 2004, and exceeding the most optimistic forecast in a Bloomberg survey of 77 economists.
Employment in the US probably grew in March by the most in three years as the economy expanded, the weather improved and the government hired temporary workers to conduct the census, economists said before a report on Friday. Payrolls climbed by 184,000 workers last month, the most since March 2007, after falling by 36,000 in February, according to the median estimate of 83 economists surveyed by Bloomberg.
In China, the Shanghai Composite Index increased 0.3% to close at 3,157.96, the highest since 21 January. It has gained 3.25 this week, the most in three months, on evidence the nation’s economic recovery has gained momentum.
Jiangxi Copper Co. Ltd, China’s biggest producer of the metal, climbed 2.7% and Datong Coal Industry Co. Ltd, the nation’s third largest coal company by capacity, gained 3.5%. Kweichow Moutai Co. Ltd, China’s biggest producer of baijiu liquor by market value, dropped 4.6% the most since 31 August, as profit trailed analysts’ estimates.
Data on Thursday showed China’s manufacturing expanded in March and the central bank said on 31 March the nation’s economic rebound has been further cemented.
Turkish stocks rallied, pushing the ISE National 100 index to the highest in more than two years, on signs the country’s economic growth is accelerating amid the global recovery. The ISE gauge rose 0.4% in Istanbul.
Deputy prime minister Ali Babacan said it won’t be a surprise if the economy grew 10% or more from a year earlier in the first quarter as the recovery is gathering pace. The government will revise forecasts in June, Babacan said.
If the government revises the growth target, this will be perceived positively by the market, said Mehmet Ilgen, a trader at Ata Invest in Istanbul.
Russia’s 30-stock Micex Index fell 0.2%, reversing earlier gains of as much as 0.6% at the start of trading. South Korea’s Kospi index rose 0.3% to close at 1,723.49 in Seoul. The index advanced 1.5% this week, climbing for an eighth week, the longest winning streak since August. Asian emerging markets including India, Indonesia and the Philippines are shut for a holiday on Friday.