Emerging-market stocks rose, sending the benchmark index to its highest level since July 2008, as takeover activity and signs that the global economic recovery is intact boosted investor confidence. The MSCI Emerging Markets Index added 0.7 percent to 1,060.60 as of 11:37 a.m. in New York, extending an 8.6 percent rally during the past four weeks. China’s Shanghai Composite Index gained 1.4 percent and the yuan hit the strongest level since 1993. Equity gauges in the Philippines, Indonesia and Turkey advanced to records. South Africa’s FTSE/JSE Africa All Shares Index rose 0.9 percent as Massmart Holdings Ltd. surged 11 percent on a buyout offer from Wal-Mart Stores Inc. Thailand’s SET Index climbed to the highest level since November 1996 and the baht strengthened to a 13-year high after the government raised its 2010 economic growth forecast for the third time in six months. A Sept. 24 report that showed rising demand for American capital equipment, along with plans by Japan to consider a new stimulus package, eased concern that global demand will falter. “We remain fairly constructive on the U.S. and hence the global economy,” Gavin Stacey, a strategist at Barclays Capital in Sydney, said in a Bloomberg Television interview. “There’s all this liquidity sloshing around and ultimately, it’s going to go into equities, and most likely emerging market equities.” Roubini Outlook The economic recovery in emerging markets is likely to be “robust” and V-shaped, New York University Professor Nouriel Roubini said in a speech in Kuala Lumpur today. The MSCI emerging index may rise about 25 percent from its current level to 1,325 in 2011, Credit Suisse Group AG strategists Sakthi Siva and Kin Nang Chik wrote in a report. Massmart advanced to a record after Wal-Mart, the world’s largest retailer, offered to buy the company in a transaction worth about $4.6 billion. Wal-Mart’s proposed offer of 148 rand ($21.10) a share would value South Africa’s second-largest listed retailer at about 32 billion rand including share options, Massmart Chief Executive Officer Grant Pattison said today. The offer price is 9.8 percent higher than Massmart’s last closing price and 66 percent above the share price at the end of last year. The rand rose 0.3 percent, earlier touching its strongest level in more than 2 1/2 years against the dollar after the Massmart announcement. Separately, Unilever agreed to buy Alberto Culver Co. for $3.7 billion in cash to add VO5, Nexxus and TRESemme hair-care products in the company’s biggest purchase in a decade. Unilever, based in London and Rotterdam, gets about 40 percent of its revenue from Asia and Africa, according to data compiled by Bloomberg. Thailand Rally Thailand’s SET Index rose 1.1 percent and the baht strengthened 0.3 percent against the dollar. Gross domestic product may expand 7.3 percent to 7.8 percent in 2010, with a mid-point forecast of 7.5 percent, Thailand’s Finance Ministry said today. The ministry in June raised the estimate to as much as 6 percent from a March projection of as much as 5 percent. Orders for U.S. capital equipment rebounded 4.1 percent in August from a 5.3 percent decline in July, figures from the Commerce Department showed on Sept. 24 in Washington. The median forecast of 11 economists surveyed by Bloomberg was for an increase of 3 percent. Japan is considering a stimulus package of as much as 4.6 trillion yen ($54.6 billion) that will be funded with existing revenue, a government official said as policy makers seek to shore up the nation’s recovery. Chinese Profits Prime Minister Naoto Kan’s administration will aim to avoid increasing issuance of government bonds, and pay for the package by allocating higher-than-forecast tax revenue and left over funds from the 2009 budget, the official said on condition of anonymity. The Shanghai Composite gauge advanced the most in three weeks as shares began trading after a three-day holiday and a report showed industrial profits jumped 55 percent during the first eight months of 2010. Dongfang Electric Corp., a maker of power equipment, jumped 10 percent. The yuan rose 0.2 percent to close at 6.6923 per dollar in Shanghai, from 6.7079 on Sept. 21, according to the China Foreign Exchange Trading System. It earlier touched 6.6859, the strongest level since the central bank unified official and market exchange rates at the end of 1993. Indonesia’s Jakarta Composite Index climbed 2.1 percent, while the Philippine Stock Exchange Index advanced 1.1 percent and Turkey’s ISE National 100 Index rose 0.6 percent. India’s Bombay Stock Exchange Sensitive Index increased 0.4 percent, while Brazil’s Bovespa gained 0.1 percent. To contact the reporters on this story: Shiyin Chen in Singapore at schen37@bloomberg.net; Michael Patterson in London at mpatterson10@bloomberg.net. To contact the editor responsible for this story: Linus Chua at lchua@bloomberg.net

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