Emerging-market stocks advanced, led by Brazilian and Indian equities, after valuations reached the lowest level versus developed markets since 2005 and falling energy prices boosted transportation companies.
ICICI Bank Limited, India’s biggest private lender, reached a one month-high and the rupee gained on speculation that oil and gold price declines will spur the central bank to cut interest rates.
Bloomberg News reported that China Southern Airlines Company rose the most since February 20 as oil fell, while Eike Batista’s MMX Mineracao & Metalicos SA jumped in Sao Paulo.
Turkish bond yields slid to a record low after a larger-than-expected interest rate cut.
The MSCI Emerging Markets Index added 0.6 per cent to 1,008.92 in New York, after slumping the most since July.
The decline drove the index down to 1.5 times net assets, compared with 1.9 for the MSCI World Index, the biggest gap since August 2005, according to data compiled by Bloomberg.
Brent crude dropped below $100 a barrel for the first time since July as West Texas Intermediate oil was little changed.
“There’s a case to be made for a little bit faster growth and very cheap valuations on the emerging market space,” Jeff Papp, a senior analyst at Oberweis Asset Management Incorporated, which manages about $700m of investments, said by phone from Lisle, Illinois.
“Some people are saying the US markets have had a great run, let us look for some laggards.’ Emerging markets are one place you may find them.”
Nine out of 10 groups in the developing-nations gauge rose as healthcare shares had the biggest gain.
The emerging markets index has lost 4.4 per cent this year as government intervention in the biggest developing nations curbed profits and economic growth slowed from South Korea to Poland.