BEIJING, Jun.9 -- Developing-nation stocks rose for a second day and bonds rallied after Reuters reported that China's exports surged, bolstering confidence in the global economy.
The MSCI Emerging Markets Index climbed 0.5 percent to 895.21 by 5 p.m. New York time. The extra yield on developing- nation debt over U.S. Treasuries fell six basis points to 3.38 percentage points, according to JPMorgan Chase & Co.'s EMBI+ Index. Hungary's forint strengthened for a third day and its bonds gained.
China's exports in May grew about 50 percent from a year earlier and new loans were 630 billion yuan ($92 billion), Reuters said, citing three unidentified people who said a government official unveiled the figures at an investor conference. The Shanghai Composite Index surged 2.8 percent, the most in two weeks and the biggest gain among emerging-market stock gauges.
"If we assume that these numbers are pretty close to what we're going to get, then it's fairly good news for China's recovery and should dispel some of the concerns about a very sharp slowdown in the Chinese economy," said Brian Jackson, a Hong Kong-based emerging-markets strategist at RBC Capital Markets.
The MSCI emerging gauge has lost 9.5 percent this year on concern the Chinese government will take steps to slow growth even as Europe's debt crisis jeopardizes the global economic expansion. The Shanghai index has retreated 21 percent this year.
"The better-than-expected export numbers show there's growth in China's economy, despite the fact that shares have been falling recently," said Monika Yang, who helps oversee $2 billion at Hamon Asset Management Ltd. in Hong Kong.
Russia's Micex Index advanced for the first time in four days, climbing 1.1 percent as the report on China helped boost oil and metals prices. OAO Lukoil rose 1 percent and OAO GMK Norilsk Nickel, Russia's biggest mining company, increased 2.1 percent.
Brazil's Bovespa index dropped, led by banks and homebuilders, as traders raised bets for interest rate increases after a gauge of inflation accelerated. Tele Norte Leste Participacoes SA, Brazil's biggest fixed-line phone company known as Oi, led the drop on the index as speculation that Portugal Telecom SGPS SA will seek to buy a stake in the Brazilian phone company eased.
The forint strengthened 0.5 percent against the euro. The rally in Hungarian bonds sent the extra yield investors demand to own the debt over Treasuries down 66 basis points, the biggest drop since May 2009, to 3.33 percentage points, according to JPMorgan's EMBI Global Index.
Prime Minister Viktor Orban said yesterday he plans to enact a new tax on banks and cut public spending as part of an attempt to meet creditor-approved budget-deficit targets. International Monetary Fund Deputy Managing Director Naoyuki Shinohara said today there isn't much to worry about right now in Hungary, the first European Union member bailed out in 2008.
Hungary's forint fell to the weakest level in a year on June 4 and bonds plunged after officials in Orban's week-old government said the nation was at risk of a Greece-like crisis and previous administration officials lied about public finances.