Global stocks rose for a second day after U.S. jobless claims decreased more than forecast and companies announced $22 billion of takeovers. LinkedIn Corp. more than doubled in the professional-networking company’s trading debut. Commodities tumbled, led by nickel and sugar.
The MSCI World Index of stocks increased 0.3 percent at 4:45 p.m. in New York and rose 1.4 percent in its two-day rebound from a five-day slump. The Standard & Poor’s 500 Index advanced 0.2 percent to 1,343.6. The 10-year Treasury yield slipped one basis point to 3.17 percent. The S&P GSCI Index of 24 raw materials slumped 1.1 percent, as nickel and sugar tumbled more than 4.5 percent. Oil retreated 1.7 percent on concern demand may weaken as the economy struggles to recover.
U.S. equities extended a global advance as jobless claims declined by 29,000 to 409,000 last week, bolstering confidence in the economy. Federal Reserve minutes released yesterday showed officials are in no hurry to raise interest rates. The S&P 500 followed a 0.7 percent advance in the Stoxx 600 Europe Index after Takeda Pharmaceutical Co. agreed to buy closely held Nycomed for 9.6 billion euros ($13.7 billion) and Toshiba Corp. offered $2.3 billion for Swiss electronic-metering company Landis+Gyr AG.
“The rally will accelerate,” said Philip Orlando, the New York-based chief equity market strategist at Federated Investors Inc., which oversees $358.2 billion. “We had an excellent jobless claims number, which tells me that we’re going to see a solid jobs report. The Fed has indicated that it will be vigilant and watching the pace of jobs recovery,” he said. “We’ll continue with easy policy.”
Gains in the S&P 500 were led by industrial and telephone companies, with only health-care stocks retreating among 10 groups. American Express Co., McDonald’s Corp. and Boeing Co. climbed at least 1.1 percent to lead the Dow Jones Industrial Average up 45.14 points, or 0.4 percent, to 12,605.32.
Thermo Fisher Scientific Inc. jumped 4.2 percent after agreeing to buy Phadia AB for about $3.5 billion to grow in testing for allergies and autoimmune diseases. Intel Corp., KLA-Tencor Corp. and Applied Materials Inc. slumped at least 1.2 percent as Goldman Sachs Group Inc. cut its ratings on the stocks amid increased competition and excess supply.
The S&P 500 extended its 2011 gain to 6.8 percent amid improving earnings. Profits beat analysts’ estimates at 72 percent of the 450 companies that reported results since April 11, according to data compiled by Bloomberg. Global per-share earnings will rise 18 percent this year, faster than an earlier forecast, Citigroup Inc. said.
Earlier today, stocks turned lower after a report showed that sales of existing homes unexpectedly declined in April, indicating the industry is struggling to gain traction as the economy expands. Separate figures from the Federal Reserve showed that manufacturing in the Philadelphia unexpectedly grew in May at the slowest pace in seven months, a sign the world’s largest economy may get less of a boost from the industry that led it out of the recession.
Unlike stocks, commodities did not recoup all their earlier losses. Oil for June delivery fell 1.7 percent to $98.44 a barrel in New York. Prices have risen 41 percent in the past year. Sugar ended a five-day rally, the longest of the year, as global supply concerns eased amid surging production in Thailand, the world’s second-biggest exporter. Cocoa and coffee also fell.
Copper fell in New York for the first time in a week after Hong Kong said it may ask some banks to set aside more reserves, fueling concern that China will take additional steps to slow inflation and economic growth.
All but four of the 24 materials tracked by the S&P GSCI Index retreated. Industrial commodities fell 1.9 percent to lead declines, followed by decreases of 1.1 percent in energy and agricultural commodities, according to data compiled by Bloomberg.
Eighteen of 19 of the main industry groups in the Stoxx 600 advanced as about four stocks gained for every one that fell. Vestas Wind Systems A/S jumped 3.4 percent after winning an order for 111 turbines for a U.S. project. BP Plc rose 1.6 percent as Bank of America Corp. advised buying the shares.
Glencore International Plc, the commodities company that sold $10 billion of stock in the world’s biggest initial share sale this year, ended its first trading day in London at the same 530-pence price offered to investors.
The MSCI Asia Pacific Index slid 0.3 percent after Japan reported its economy shrank more than estimated last quarter and Gartner Inc. said Samsung Electronics Co.’s market share in mobile devices declined.
The Nikkei 225 Stock Average dropped 0.4 percent after the first gross domestic product report since the March 11 earthquake showed the nation entered its third recession in a decade.
The FTSE 100 Index rallied for a second day in London, climbing 0.6 percent. British retail sales including auto fuel climbed 1.1 percent from March, the Office for National Statistics said today in London. The increase topped the 0.8 percent median forecast of 20 economists in a Bloomberg survey.
The yield on the Spanish 30-year bond climbed four basis points to 5.40 after the government sold 3.2 billion euros of 10-year and 30-year bonds, less than the 4 billion euros planned.
France auctioned 8.5 billion euros of 2013, 2015 and 2016 notes, as well as 1.98 billion euros of index-linked bonds today. The U.K. auctioned 5 billion pounds of 2014 debt, while the U.S. plans to sell $11 billion of 10-year Treasury Inflation Protected Securities.