Stocks rose to a four-week high, metals rallied and corporate creditworthiness improved on the prospects for economic growth. European bonds rebounded from three days of losses.
The MSCI World Index of shares in 24 developed markets climbed 0.4 percent at 10:33 a.m. in London, while U.S. stock- index futures swung between gains and losses on the Labor Day holiday. The cost of insuring European corporate bonds using credit-default swaps fell for a fourth day, the longest decline in six weeks. German bunds and U.K. gilts rallied, while copper rose more than 1 percent and nickel advanced 2.9 percent. The yen strengthened against 13 of its 16 most-traded peers.
“People have to recognize we’re not facing economic Armageddon,” Mark Tinker, global equity-portfolio manager in London for Axa Framlington, which oversees $30 billion, said on Bloomberg Television’s “Start Up” with Maryam Nemazee.
Factory production in the U.K. grew at a record pace in the third quarter, the Engineering Employers Federation said today. The Group of 20 nations are confident that there’s a “moderate recovery under way globally,” John Lipsky, first deputy managing director of the International Monetary Fund, said yesterday. The S&P 500 Index rose 3.75 percent last week as a series of economic reports eased concern the U.S. is sliding back into a recession.
The Stoxx Europe 600 Index rose 0.2 percent as two shares gained for every one that declined. E.ON AG and RWE AG, Germany’s biggest utilities, climbed more than 2 percent as Chancellor Angela Merkel agreed to extend the life of the nation’s nuclear power plants.
GN Store Nord A/S rallied 5.2 percent in Copenhagen after a tribunal awarded the world’s biggest maker of mobile headsets about 2.2 billion kroner ($380 million). Cable & Wireless Worldwide Plc jumped 4.7 percent after the Independent on Sunday reported that Singapore Telecommunications Ltd. is considering an offer for the U.K. company.
German 10-year bonds advanced for the first day in four as yields close to the highest level in three weeks attracted investors to government debt. The yield on the 10-year bund fell 5 basis points to 2.32 percent after reaching 2.37 percent last week, the most since Aug. 19. U.K. 10-year gilt yields also declined 5 basis points, to 2.96 percent.
The Markit iTraxx Crossover Index of credit-default swaps on 50 mostly junk-rated European companies fell 6.1 basis points to a one-month low of 476.4, according to Markit Group Ltd.
The yen was 0.2 percent stronger at 84.15 per dollar and traded at 108.58 per euro, from 108.73. The euro was little changed at $1.2903.
Technology stocks paced gains on the MSCI Asia Pacific Index, which climbed 1.6 percent to 121.91. Samsung Electronics Co., Asia’s biggest maker of chips, flat screens and mobile phones, gained 2.5 percent after saying it may invest 30 trillion won ($26 billion) in 2011.
Futures on the S&P 500 expiring this month rose 0.1 percent. Private U.S. payrolls that exclude government jobs increased 67,000 in August, after a revised 107,000 jump in July, the Labor Department said July 3.
The MSCI Emerging Markets Index climbed 0.8 percent, rising for a fourth day. Indonesia’s Jakarta Composite Index reached a record level while benchmark equity indexes in China, India, Dubai and Hungary increased more than 1 percent. China’s yuan appreciated to the strongest level since Aug. 19 as Larry Summers, head of President Barack Obama’s National Economic Council, started a meeting in Beijing today with the head of the Communist Party’s organization department, leading to speculation China’s central bank will allow more gains.
Nickel led increases on the London Metal Exchange, rising $600 metric tons to $22,200 a ton on declining inventories. Copper jumped $82.75 to $7,728.75 a ton, as stockpiles fell to the lowest levels since Nov. 10.
To contact the reporter for this story: Paul Sillitoe in London at firstname.lastname@example.org.