Sept. 10 (Bloomberg) -- Developing-nation stocks rose, driving the MSCI Emerging Markets Index to its most expensive level in nine years, as Indian software makers rallied and higher oil prices boosted the revenue potential of economies sustained by exports. The MSCI Emerging Markets Index increased 0.5 percent at 11:55 a.m. in London, pushing valuations to 19.9 times reported earnings for the first time since June 29, 2000, according to data compiled by Bloomberg. Emerging market shares have risen 53 percent this year as government stimulus packages, bailout loans and interest-rate cuts from Hungary to China fueled optimism that the worst of the financial crisis is over. “Valuations have been pushed up very aggressively,” said John Lomax, head of global strategy for emerging markets at HSBC Holdings Plc in London. “The macro-economic context is generally pretty supportive.” The MSCI Emerging-Markets index trades for 15.9 times analysts’ earnings estimates for 2009, the highest level since Bloomberg began tracking estimates in January 2006. Infosys Technologies Ltd., India’s second-largest software services provider, rose to its highest since 2007. Nomura Holdings Inc. raised its rating on the software industry to “neutral” from “bearish” given the outlook for growth in the U.S. and Europe, an improvement in spending and expanding operating margins. The Bombay Stock Exchange’s Sensitive Index rose 0.2 percent to the highest since May 30. ‘Asset Bubbles’ United Arab Emirates shares gained for a sixth day. The ADX General Index of stocks in Abu Dhabi, holder of the world’s sixth largest crude reserves, climbed as much as 1.4 percent to the highest closing level in 10 months. Indexes in Kazakhstan, Latvia, Dubai, Bulgaria and Lithuania rose more than 1 percent. Bank of China Ltd., which led the nation’s $1.1 trillion lending spree in the first half, said ample liquidity has caused “bubbles” in global markets. “You see asset bubbles in commodities, stocks and real estate, not only in China, but everywhere,” Vice President Zhu Min said in an interview in Dalian today. “Many investors are now concerned that global emerging market valuations are stretched, leaving the markets vulnerable,” Jeffrey Palma, a Stamford, Connecticut-based global equity strategist at UBS AG, wrote in a research note. “We find that current valuations still imply relatively modest long-term growth rates.” Oil, Hogs The Dow Jones Stoxx 600 Index of European shares dropped 0.5 percent. The regional gauge, which has surged 52 percent since March 9, is valued at 46 times profit, near the highest level since 2003, according to data compiled by Bloomberg. The MSCI Asia Pacific Index rallied 1.2 percent to the highest in almost a year. China Yurun Food Group Ltd., the country’s largest hog processor, added 7.4 percent in Hong Kong after its first-half profit rose 37 percent. Crude oil for October delivery advanced for a fourth day in New York, rising 0.6 percent to $71.80 a barrel as the International Energy Agency raised its global oil demand forecast for next year for a second month and OPEC agreed to maintain output targets. Industrial metals fell in London on concern that stockpiles are growing. Lead dropped 6.6 percent to $2,246 a metric ton, the biggest decline in almost three months. The Micex index in Russia, the world’s biggest energy-exporting economy, lost 0.7 percent, erasing earlier gains.

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