Emerging Markets Advance Because of Positive Chinese Industrial Data

For the 4th straight day, the stocks of the emerging markets have advanced. The benchmark index is also on a 7-month high. The better than estimated industrial production and retail sales data of the Asian powerhouse China attributed to the growth as many economists predict these results to be signaling a stronger global economy. The MSCI Emerging Markets Index has increased by 0.4% and is currently at 1028.36. This is the highest level for the index since 3rd May.

A state owned offshore energy explorer from China, Cnooc Ltd. jumped to its highest share prices since last May as Canada approved its proposal to takeover of Nexen Inc. in a deal worth $15.1 billion. The largest producer of metal in the world, OAO GMK Norilsk Nickel also rose to its highest level in the last 5 months, mainly because of the commodities rise in Moscow.

Amiya Capital LLP’s Emerging Market Strategist, Michael Wang stated that the good data from China signals that the growth trajectory has got sort of stability. Michael added that China will play a key part in the global growth.

Among the major emerging markets, Chinese stocks have experienced the biggest gain. The Shanghai Composite Index (SHCOMP) has surged by 1.1% and this marks a 1-month high for the index. The trading volumes were more than 86% ahead of the 30-day average. The Hang Seng China Enterprises Index, on the other hand, rose by 0.7%. Bovespa Index of Brazil and Benchmark Stock Index of Turkey has gained 0.8% and 0.7% respectively. The Micex Index of Russia saw an increase of 0.4%.

Among the major players in the emerging market stocks, Samsung Electronics Co has surged by 0.7%. The biggest mobile phone operator in Malaysia by market value, Axiata Group Bhd. also jumped by 3.5%. AmBev saw an increase of record 13%. Billionaire Eike Batista owned oil producing company, OGX Petroleo & Gas Participacoes SA also saw increase in the share prices. It was helped by the recent reports suggesting that Batista may sell some parts of his stake in the company to the National Development Bank of Brazil. OAO RusHydro, the biggest renewable energy producer of Russia also gained around 3.4%, marking its highest surge since 22nd November. The renowned poultry producer from Turkey, Banvit Bandirma Vitaminli Yem Sanayii AS also increased the most since last January.