Emerging-market stocks advanced for a second day after Iran agreed to limit its nuclear program, bolstering appetite for riskier assets. OAO Gazprom paced declines in energy producers as crude oil slumped.
Crude oil slid to a five-month low and stocks fell, with emerging-market shares extending the longest slump in seven years, as an improving U.S. economy fueled speculation the Federal Reserve will reduce stimulus sooner than estimated. The dollar gained against most major peers and Treasury yields rose while industrial metals declined.
Even with the flawed roll out of health-care reform and uproar over spying, Barack Obama is enjoying one of the best stock markets for a re-elected president. Signs are building that it might not last.
Concern that a surge in U.S. bond yields will curb the expansion is overblown, says money manager James Paulsen. When coupled with gains in confidence, higher borrowing costs are a healthy sign for the world’s largest economy.
Commodities beat bonds, stocks and the dollar for a third month, the longest winning streak in two years, as the prospect of military strikes in Syria boosted oil and gold. Emerging markets declined as currencies plunged from Brazil to Turkey to India.