Emerging stocks edge higher before OPEC talks

London - Emerging-market stocks edged higher as markets in Europe and Africa rebounded while oil halted losses before a meeting of major producers.

Shares in Russia snapped a three-day decline as Brent crude climbed above $45 a barrel. SABMiller helped lift the South Africa’s benchmark to the first advance this week after investors approved a takeover by Anheuser-Busch InBev. '

Saudi Arabia stocks posted the steepest two-day slump since January amid concern austerity measures will curb growth, while people familiar with the matter said the kingdom’s first international bond may be delayed.

Gains in oil prices buoyed European energy stocks after Saudi Arabia signalled it may compromise with Iran on a future output agreement.

Developing-nation shares are headed for their best quarterly performance since 2012 after near-zero rates boosted demand for riskier assets and the Federal Reserve maintained its accommodative policy.

"Today’s story is indeed oil, especially given the significant comments from Saudi Arabia," said Simon Quijano-Evans, an emerging-markets strategist at Legal & General Group in London.

"Today’s oil meeting will be decisive for the exposure-split between emerging-market oil exporters and importers."

While Iran and Saudi Arabia expect no agreement when OPEC members meet on Wednesday in Algiers, Saudi Arabian Oil Minister Khalid Al-Falih said a deal is possible in November, when the group meets in Vienna.

Stocks

The MSCI Emerging Markets Index advanced less than 0.1% to 911.81 by 1:21 in London. The gauge has gained 9.3% this quarter, helping valuations rise to 12.5 times projected 12-month earnings. That compares with a multiple of 16 for the MSCI World Index of developed-nation stocks, which has increased 4.2% in the period.

Russia’s Micex Index added 0.6%, its first advance in four days, with Sberbank PJSC contributing the most to the gains. Novatek OJSC, a natural-gas producer, rose 1.1%.

The FTSE/JSE Africa All Share Index jumped 1.6%. SABMiller climbed 2.1% after shareholders voted 95.46% in favour of the $10bn takeover by AB InBev.

Steinhoff International Holdings rallied 4.4% after saying it planned to raise as much as €24bn to repay money that the furniture and clothing retailer borrowed for recent acquisitions.

Saudi Arabia’s stocks tumbled 3.4%, bringing its two-day slump to 7.1%. The kingdom announced this week it will curb state employees’ allowances and cancel bonus payments.

Today, the U.S. Senate may vote to override President Barack Obama’s veto of the legislation that would allow the families of 9/11 victims to sue Saudi Arabia, two of the people said, asking not to be identified as the matter is private.

Currencies

The MSCI Emerging Markets Currency Index was little changed after adding 0.3% on Tuesday. The measure is up 2.3% since the end of June, on track for a third quarterly rally.

The South African rand weakened 1.1% on Wednesday, the biggest decline of 24 emerging-market currencies, followed by a 0.4% drop in the Malaysian ringgit. The Chilean peso and South Korean won led gains.

Bonds

The premium investors demand to hold emerging-market bonds over US Treasuries was unchanged at a one-week high of 340 basis points, according to JPMorgan Chase indexes.

Turkish bonds advanced for a second day, sending the yield on 10-year lira bonds five basis points low to 9.63%.

Bonds have recouped more than half of their losses this week after Moody’s Investors Service downgraded the country’s debt to junk.