Emerging Stocks Climb for Sixth Day on China Output

“Emerging-market stocks rose, set to finish 2012 with a sixth day of gains, as Chinese manufacturing data beat estimates and the deadline approached for U.S. lawmakers to avert automatic tax increases and spending cuts.

Chinese industrial companies such as Zhuzhou CSR Times Electric Co. rallied after the manufacturing data. China Life Insurance Co. (601628) jumped to a 16-month high in Hong Kong after the nation’s securities watchdog said insurers would be allowed to set up mutual funds. Lenovo Group Ltd. (992), the world’s biggest maker of personal computers, fell for a second day to a five- week low after its chief executive officer cut his stake.

The MSCI Emerging Markets Index (MXEF) added 0.1 percent to 1,056.31 as of 4:57 p.m. in Hong Kong to its highest level since March, extending this year’s gains to 15 percent. China’s manufacturing expanded at the fastest pace since May 2011 in December, beating a preliminary estimate, according to a survey released today by HSBC Holdings Plc and Markit Economics. The U.S. Congress is working to avert more than $600 billion in tax increases and federal spending cuts, the so-called fiscal cliff, as the year-end deadline approaches.

“The data shows recovery in the Chinese economy and that’s positive for industrial and metal producers,” said Alex Mathews, head of research at Geojit BNP Paribas Financial Services Ltd. in Kochi, South India. “Most traders have their eyes on the U.S. fiscal cliff and how it unfolds. With most markets closed, most investors are in a holiday mood.”

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