Emerging Stocks Rise, Paring Fifth Weekly Decline, as Baht Gains

Emerging-market stocks rose, paring a fifth weekly decline, after valuations fell to an 11-month low. The won and the baht led currencies higher, while Turkish bonds rallied.

Samsung Electronics Co. gained for the first time in seven days. PT Bumi Resources, Indonesia's biggest coal exporter, advanced from the lowest level since January 2009. Benchmark indexes in Indonesia, Thailand and the Philippines climbed more than 2 percent. Chinese shares in Hong Kong fell for a record 12th day as the nation's Finance Ministry failed to sell all of the debt offered at an auction.

The MSCI Emerging Markets Index advanced 1.2 percent to 954.69 from its lowest close since Sept. 5 at 9:33 a.m. in London. The gauge fell 2.6 percent this week, heading for its longest run of declines in a year, as foreign investors pulled funds from developing-nation assets amid concern the Federal Reserve would pare stimulus known as quantitative easing.

"In the long run, we think emerging markets are going to be quite OK," Norman Chan, head of investment at Calibre Asset Management Ltd., a unit of National Australia Bank Ltd., said in a Bloomberg TV interview in Hong Kong today. "The U.S. economic recovery is still intact. Eventually the U.S. is going to lift emerging markets, especially Asia. The QE exit has been overblown."

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Emerging-market equity funds had outflows of $5.8 billion in the week to June 12, Citigroup Inc. said in a note today, citing EPFR Global. That follows net withdrawals of $5 billion in the previous week, according to Citigroup.

Stock Valuations

This week's losses helped drag 12-month projected earnings on MSCI's developing-nation measure to 9.7 times yesterday, the lowest level since July 2012, according to data compiled by Bloomberg.

Samsung rose 0.9 percent, snapping a six-day, 12 percent retreat. Bumi Resources advanced 7.7 percent, paring its decline in the past month to 18 percent. PT Global Mediacom surged 9.5 percent in Jakarta, the most among stocks on MSCI's emerging-market index, after falling to a nine-month low yesterday.

Stock indexes in Southeast Asia rallied after tumbling this month. The Philippine Stock Exchange Index advanced 2.1 percent, the Jakarta Composite Index added 3.3 percent and Thailand's SET Index climbed 3.5 percent.

More than $2.5 trillion has been erased from the value of global equities since Fed Chairman Ben S. Bernanke said May 22 that policy makers could scale back stimulus efforts should the job market show "sustainable improvement."

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Aluminum Corp. of China Ltd. plunged 7.5 percent in Hong Kong before its removal from the Hang Seng China gauge of mainland companies. The H-share index fell 0.2 percent. The measure lost 20.4 percent through yesterday since its recent peak on Jan. 30, exceeding the 20 percent level that signals a bear market to some investors.

The Finance Ministry's failure to sell all of the debt offered at an auction for the first time in 23 months comes during a cash squeeze that threatens to exacerbate a slowdown in the world's second-largest economy.

The ministry sold 9.53 billion yuan ($1.55 billion) of 273-day bills, less than the 15 billion yuan target, according to two traders at finance companies that participate in the auctions.

The Shanghai Composite Index added 0.6 percent for its first gain in nine days.

India's S&P BSE Sensex climbed 1.6 percent after an official report showed inflation slowed to a 43-month low in May. The rupee rallied 0.6 percent against the dollar.

Thailand's government bonds advanced, pushing the 10-year yield down by the most since July 2012, and the baht climbed 0.8 percent versus the dollar. The yield on Turkish 2-year benchmark bonds fell 53 basis points. South Korea's won rose the most in two months.

MSCI's developing-nation index has lost 9.5 percent this year, compared with an 9.7 percent advance in the MSCI World Index of developed-country stocks.