By Stephen Kirkland July 8 (Bloomberg) -- Stocks rose for a third day and oil rallied as the International Monetary Fund lifted its estimate for global economic growth and U.S. jobless claims fell more than forecast. The benchmark 10-year Treasury yield climbed above 3 percent for the first time this month. The Standard & Poor’s 500 Index rallied 0.9 percent to 1,069.44 at 9:42 a.m. in New York, extending its three-day rebound from a 10-month low to almost 5 percent. The yen depreciated against all 16 of its most-traded counterparts, while the Australian dollar and South Korea’s won strengthened. Oil climbed to a one-week high. Credit-default swaps to insure Greek bonds fell 18 basis points, according to CMA DataVision. The S&P 500 extended its longest streak of gains since April as the 21,000 decrease in jobless claims and growth in June retail sales bolstered confidence before the second-quarter earnings season starts next week. The world economy will expand 4.6 percent this year, the biggest jump since 2007, the IMF said. European banks gained on speculation stress tests will show narrower losses than some analysts estimated. “I doubt we’ll have another global recession,” said Masayuki Kubota, a fund manager at Tokyo-based Daiwa SB Investments Ltd., which oversees $51 billion. “People are very sensitive to economic data from the U.S. If something good comes out, market sentiment easily rebounds. I’m buying sectors which were sold on excessive pessimism.” Industrial, energy and raw-materials companies led gains among all 10 industries in the S&P 500 as the index built on yesterday’s 3.1 percent surge. Banks Upgraded The Stoxx Europe 600 Index advanced 1.2 percent as HSBC Holdings Plc, Barclays Plc BNP Paribas SA led banks higher. Strategists at Credit Suisse Group AG raised their recommendation for lenders to “benchmark,” saying European sovereign-debt risk is overstated, the financial industry is undervalued and the European Union stress tests “may be a positive catalyst.” The European Central Bank and Bank of England kept their key interest rates unchanged today. Crude for August delivery rose as much as 1.9 percent to $75.46 a barrel in electronic trading on the New York Mercantile Exchange after a report by the American Petroleum Institute showed the biggest weekly decline in U.S. oil inventories since September. Gold for immediate delivery slipped 0.2 percent to $1,199.88 an ounce. The IMF predicted growth of 2.6 percent this year in advanced economies, more than the 2.3 percent seen in April, while emerging market will expand 6.8 percent, up from 6.3 percent, according to revisions to its World Economic Outlook. Asia, Emerging Markets Asian stocks advanced, pushing the MSCI Asia Pacific Index 1.8 percent higher. NEC Corp. advanced 2.2 percent after saying it aims to double its share of the world’s supercomputer market in the next four years and AU Optronics Corp., Taiwan’s second- largest flat panel maker, gained 4.6 percent as sales rose. In Europe, A.P. Moeller-Maersk A/S climbed 3.1 percent as the world’s biggest container shipper raised its 2010 forecast. The MSCI Emerging Markets Index jumped 1.3 percent, heading for the highest closing level in almost two weeks. The yen depreciated 0.9 percent to 88.52 per dollar and weakened 1.4 percent to 112.35 against the euro. South Korea’s won strengthened 1.1 percent to 1,209.40 per dollar on speculation the country’s exporters will report earnings this month that exceed analyst estimates. Australia Jobs Growth The Australian dollar rose against all of its 16 most- traded counterparts, jumping 1.5 percent to 87.74 U.S. cents, after a report showed job growth in the nation exceeded forecasts in June, fueling speculation that the central bank will have to resume boosting interest rates. Credit-default swaps tied to Spain’s sovereign bonds dropped 11 basis points to 235, Portugal declined 14.5 basis points to 277 and Italy lost 8.5 basis points to 165.5, CMA prices show. The U.S. 10-year Treasury yield was at 3.03 percent, near the highest in more than a week, before the government sells a record-tying $12 billion of Treasury Inflation Protected Securities today and also announces the sizes of three-, 10- and 30-year bond auctions for next week. The yield on the German two-year note rose five basis points to 0.73 percent, while the 10-year bund yield increased four basis points to 2.64 percent. --With assistance Nicolas Johnson and Monami Yui in Tokyo, Claudia Carpenter, Abigail Moses, Michael Patterson, Andrew Rummer, Daniel Tilles and Steve Voss in London. Editors: Stephen Kirkland, Mark Gilbert To contact the reporter on this story: Stephen Kirkland in London at skirkland@bloomberg.net To contact the editor responsible for this story: Mark Gilbert at magilbert@bloomberg.net

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