Stocks, Oil Rise on Economy; Canadian Dollar Gains on Jobs
ECB President Jean-Claude Trichet said that while the fiscal crisis isn’t over, the economic signs are 'encouraging.' Photographer: Hannelore Foerster/Bloomberg
July 9 (Bloomberg) -- Bloomberg's Courtney Donohoe reports on the performance of the U.S. equity market today. Stocks advanced, sending the Standard & Poor’s 500 Index to the biggest weekly gain in a year, amid optimism about earnings reports and a rally in metals that drove up shares of its producers. Bloomberg's Pimm Fox also speaks. (Source: Bloomberg)
July 6 (Bloomberg) -- Manpreet Gill, Singapore-based strategist for Asia at Barclays Wealth, talks with Bloomberg's Rishaad Salamat about his investment strategy for gold and other commodities. Gill also discusses the outlook for the Australian dollar and stocks, and South Korean equities. (Source: Bloomberg)
Stocks rose, with the MSCI World Index headed for its biggest weekly rally in a year, and copper and oil gained on waning concern the global recovery will falter. Canada’s dollar surged 1.1 percent versus the dollar after the nation’s job growth topped forecasts.
The MSCI gauge of 24 developed nations climbed 0.4 percent and the Standard & Poor’s 500 Index increased 0.2 percent at 10:51 a.m. in New York, with both extending their advances this week to about 5 percent. Copper increased to a two-week high in New York. The cost of insuring bank debt from losses fell to the lowest in eight weeks. The 10-year Treasury yield climbed three basis points to 3.06 percent
U.S. equities have rallied this week amid optimism that second-quarter earnings will justify the S&P 500’s rebound from a 10-month low on July 2. Profits at companies in the index are projected to have increased 34 percent in the April-June period, led by income growth at financial, energy and technology companies. French manufacturing expanded in May, spurred by improving global trade and a pickup in output at car plants
“There are tentative signs that the pessimism has reached saturation point,” Graham Bishop and Ian Richards, analysts at Royal Bank of Scotland Group Plc in London, wrote in a note. “The macro risks may not have disappeared, but we believe they are amply discounted.”
Alcoa Inc., the largest U.S. aluminum maker, is due to report earnings next week, the first company in the Dow Jones Industrial Average to announce results for the second quarter. Commodity, financial and industrial companies led gains in the S&P 500 today among 10 groups. Caterpillar Inc., Alcoa and DuPont Co. climbed at least 1.9 percent to lead the Dow above its highest close since June 23.
Google China
Google Inc. rallied 2.5 percent to $467.84. The owner of the world’s largest Web search engine said the Chinese government renewed its Internet license, after the company submitted a revised application to meet regulations in the world’s biggest market by users.
The Stoxx 600 rallied for a fourth day. Michael Page International Plc climbed 2.1 percent in London after the U.K.’s second-largest recruitment company’s profit increased. Rio Tinto Group climbed 4 percent. Copper producer Antofagasta Plc surged 4.6 percent after Citigroup Inc. recommended buying the shares.
Copper rose 1.5 percent to $3.062 a pound in New York and 2.1 percent to $6,755 a metric ton on the London Metal Exchange. Crude oil for August delivery climbed 1 percent to $76.20 a barrel.
Emerging Markets
The MSCI Emerging Markets Index climbed 1.1 percent, headed for the biggest weekly advance in four months. China’s Poly Real Estate Co. led gains by developers after the Oriental Morning Post reported some Shanghai banks have resumed lending to third- home buyers. South Korea’s won jumped 1 percent versus the dollar after the Bank of Korea unexpectedly raised its benchmark interest rate.
Emerging-market stocks will rally as much as 25 percent by the end of the year as the global economy avoids a “double dip” recession and attractive valuations lure investors, Citigroup Inc.’s New York-based strategist Geoffrey Dennis wrote in a research report dated yesterday.
The cost of insuring against losses on European financial bonds fell to the lowest level in eight weeks on optimism stress tests may boost confidence in the region’s banks.
The Markit iTraxx Financial Index of credit-default swaps linked to 25 European banks and insurers fell nine basis points to 131, the lowest since May 12, according to JPMorgan Chase & Co. The yield on the 10-year German bund rose was little changed at 2.63 percent, and the two-year note yield climbed four basis points to 0.76 percent.
To contact the reporter on this story: Stephen Kirkland in London at skirkland@bloomberg.net
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