For the very 1st time in last 3 days, the stocks of the emerging markets have surged ahead, mainly due to the good performance of information technology companies. However, the material and utility producers experienced a fall. The MSCI Emerging Markets Index or MXEF went ahead by 0.1% and is at 1043.73 currently. Out of all the shares, 326 advanced, 303 went down and the rest 192 were unchanged. The money markets of countries such as Romania and Brazil were closed today because of the Christmas holidays. Economists are now anxiously waiting to see the ultimate outcome of the budget related negotiations as 17% of the total exports of the emerging markets are done to US.
Chris Weafer, the Chief Strategist of Sberbank Investment Research stated that it is to be seen that how investors view the progress on US budget deal as this is going to play a primary role in deciding how the emerging markets will finish 2012. Apart from that, the stance towards the risk assets is also going to be an important factor.
The measure for developing nations has increased by 14% in 2012 which is more than the 13% surge of the MSCI World Index. The emerging market index actually is being traded at 12 times more than the initially estimated earnings. The MSCI World, on the other hand, is trading at 13.8 times of the initial estimates.
Coming to company stocks, the largest smartphone maker in the world, Samsung Electronics Co. surged ahead by 2.2%. Incidentally, Taurus Investment Securities predicted that the earnings of the company will be more than the expectations set earlier. The biggest oil producer of Russia, OAO Rosneft also advanced, whereas, the largest coking-coal producer of Russia, OAO Mechel experienced its biggest fall in the last 6 weeks.
The renowned Turkish manufacturer of pipes, Borusan Mannesmann Boru Sanayi ve Ticaret AS has advanced by 2.6%, marking its biggest gain since 28th August. The company has already announced its plans to invest around $150 million in a US plant by end of 2014 and this news probably has affected the shares in a positive manner. OAO GMK Norlisk Nickel, the biggest producer of palladium and nickel has dropped by 1.3% as the same will have to pay a dividend worth $9 billion over the period of next 3 years.