Stocks rallied around the world and Europe’s Dow Jones Stoxx 600 Index recouped its 2009 loss amid growing speculation the worst of the global recession is over and a stream of earnings that beat analysts’ estimates. The Stoxx 600 climbed 2 percent at 12:09 p.m. in London, extending its April advance to 14 percent, the best month on record. Futures on the Standard & Poor’s 500 Index gained 1.7 percent, indicating the benchmark gauge for U.S. equities will add to its steepest monthly advance since March 2000. U.S. and European government bonds fell. The yield on the 10-year Treasury note rose to 3.14 percent, the highest since November. Equities climbed as companies from BASF SE to Dow Chemical Co. and MAN AG posted earnings that beat analysts’ estimates and Honda Motor Co. forecast an annual profit. Industrial output in Japan rose for the first time in six months. U.K. consumer confidence climbed to the highest level in a year. “All the things are in place for the bear market to have ended,” Anthony Bolton, president of investments at Fidelity International, said in an interview with Bloomberg Television in Hong Kong. “When there’s a strong consensus, a very negative one, and cash positions are very high, as they are at the moment, I’d like to bet against that.” Fidelity International is the London-based affiliate of Fidelity Investments, the world’s largest mutual-fund company. Bolton’s Special Situations Fund beat the FTSE All-Share Index on an annual basis by 6 percentage points from 1979 through 2007, according to Fidelity. Taiwan Stocks Taiwan’s Taiex stock index jumped the most since August 1991 after the government allowed Chinese investments for the first time in six decades and Hsinchu, Taiwan-based Taiwan Semiconductor Manufacturing Co. posted first-quarter profit that beat expectations. The MSCI Emerging Markets Index, the benchmark for 23 developing countries, climbed 3.1 percent and is up 17 percent this month, the steepest gain since April 1989. The MSCI World Index of developed countries has gained 11 percent since March 31, the biggest advance since 1987. More than half of 129 companies in the Stoxx 600 that reported earnings since April 7 exceeded analysts’ predictions, compared with 43 percent in the previous quarter, data compiled by Bloomberg show. About two-thirds of S&P 500 companies have beaten estimates. Treasuries fell after Pacific Investment Management Co., which runs the world’s largest bond fund, said U.S. debt will lag behind European bonds as America’s economy recovers faster than the 16-nation euro region. The yield exceeded 3.10 percent yesterday for the first time since Nov. 25. Bunds, Gilts German 10-year bunds fell for the first time in a week. The yield rose seven basis points to 3.2 percent, the biggest increase since April 17. The yield on the 10-year U.K. gilt climbed nine basis points to 3.54 percent, the highest level since March 4. The pound strengthened as much as 1.2 percent to $1.4947 after GfK NOP’s index of U.K. consumer sentiment rose three points to minus 27 in April, the best reading since April 2008. Hog futures for June settlement dropped 1.7 cents, or 2.6 percent, to 65.05 cents a pound on the Chicago Mercantile Exchange after falling to 64.9 cents, the lowest compared with intraday prices since March 11. The world is on the verge of the first influenza pandemic since 1968 after swine flu broke out in Mexico, the U.S. and seven other countries, according to the World Health Organization. WHO raised its six-tier alert to 5, the second-highest. The disease may have killed more than 159 people. BASF, MAN BASF, the world’s biggest chemical company, climbed 8 percent to 28.75 euros. The Ludwigshafen, Germany-based company reported first-quarter net income of 375 million euros ($501 million), beating the 124 million-euro estimate of analysts. Dow Chemical, the largest U.S. chemical maker, added 2.8 percent to $13.89 in German trading. The Midland, Michigan-based company’s profit excluding some items was 12 cents a share. The average estimate of 11 analysts in a Bloomberg survey was for a 19-cent loss. MAN, Europe’s third-largest truckmaker, added 5.7 percent to 48.50 euros. The Munich-based company’s first-quarter earnings fell a less-than-estimated 44 percent as job cuts helped its main division remain profitable. Honda, which sells about 42 percent of its cars in North America, climbed 9.4 percent to 2,845 yen. The Tokyo-based company expects operating profit of 10 billion yen ($103 million) this fiscal year. The cost of protecting against investment-grade companies not paying their debt fell in the market for credit-default swaps, with the Markit iTraxx Europe index of 125 borrowers declining 2.5 basis points to 142, according to JPMorgan Chase & Co. prices at 9:17 a.m. in London. Credit-default swaps pay the buyer face value in exchange for the underlying securities or the cash equivalent should a company fail to meet its debt agreements. A basis point on a contract protecting 10 million euros of debt from default for five years is equivalent to 1,000 euros a year.

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