Shares in developing nations were on the brink of a bull market as oil rose and favorable shifts in central-bank policies supported riskier assets. Bonds extended this week's gains.
Emerging-market stocks advanced for a third day after the
Federal Reserve this week reined in its forecast for interest-rate hikes in 2016. Futures signaled the Standard & Poor's 500 Index will rise and automakers led gains in Europe as a weaker euro boosted earnings prospects. U.S. crude gained after soaring 11% in the last two days. Treasuries advanced and 10-year yields sank to a record low in Japan.
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More than $3.5 trillion has been added to the value of global equities this month and commodities have rallied amid central bank steps to spur growth. The Fed's move complemented a wave of monetary easing that saw Norway and Indonesia cut borrowing costs on Thursday, a week after the European Central Bank boosted stimulus. The People's Bank of China loosened lenders' reserve requirements at the start of this month.
“We've finally seen some signs of a light at the end of the tunnel,” said William Hobbs, head of investment strategy at
Barclays Plc's wealth-management unit in London. “Central banks will remain accommodative and this has brought a bit of an increase in risk appetite.”
EMERGING MARKETS
The MSCI Emerging Markets Index rose 0.9% at 10:45 a.m. in London, bringing gains from a low in January to just shy of the 20% threshold of a bull market. Technology stocks led the advance after Tencent Holdings Ltd., Asia's biggest Internet company, posted a better-than-expected 45% jump in quarterly sales.
The Hang Seng China Enterprises Index of mainland stocks listed in Hong Kong rose 1.2%, following a 2.4% rally on Thursday. The Shanghai Composite Index jumped 1.7%, with trading volumes 59% above the 30-day average, according to data compiled by Bloomberg.
New-home prices gained in 47 Chinese cities in February, compared with 38 in January, the National Bureau of Statistics said Friday, signaling efforts to clear a home glut may be bearing fruit after banks eased credit and the government relaxed curbs.
STOCKS
The Stoxx Europe 600 Index climbed 0.4%. Daimler AG and BMW AG led gains among carmakers.
Amid one of the weakest earnings seasons in at least nine years and oscillating faith in central banks, strategists have slashed expectations for European stocks, painting the gloomiest annual outlook in five years. The Euro Stoxx 50 Index is expected to advance 1% by the end of 2016. Only a few months ago, those same strategists were calling for a 12% rally.
S&P 500 futures rose 0.3%, as the equity gauge approaches its break-even level for the year. The Dow Jones Industrial Average on Wednesday erased its 2016 losses, as a weaker dollar spurred a rally in commodity producers and industrial shares that spread to the broader U.S. stock market.
