Stocks climbed to a two-month high, while the euro strengthened and oil advanced on signs Europe’s debt crisis is easing. Precious metals declined.
The MSCI All-Country World Index (MXWD) rose 0.5 percent as of 8:02 a.m. in London. The Stoxx Europe 600 Index gained 0.9 percent and Standard & Poor’s 500 futures added 0.2 percent. The euro strengthened 0.3 percent to $1.2859, a performance second only to South Korea’s won among 16 major currencies. Oil jumped 0.9 percent after falling yesterday as a European Union official said an Iranian oil embargo may be delayed. Gold retreated from a one-month high as silver and platinum fell.
European stocks headed for a fourth weekly advance, the longest run of gains since October. Borrowing costs for Spain and Italy fell at debt sales yesterday, while European Central Bank President Mario Draghi said he saw “tentative signs” of stabilization in the euro region. Data today is expected to show U.S. consumer confidence is at a seven-month high, based on the median forecast in a Bloomberg survey of economists.
ECB policy makers “have stabilized the whole situation,” said Diane Lin, a fund manager at Sydney-based Pengana Capital Ltd., which manages about $1.1 billion. “We should see some good performances in Asian equity markets.”
The MSCI Asia Pacific Index gained 0.9 percent. The measure has rallied 9.1 percent from a two-year low in October, pushing valuations to 12.3 times estimated profit, based on data compiled by Bloomberg. Two stocks (MXAP) gained for each that fell in the index today. The Nikkei 225 advanced 1.4 percent and Australia’s S&P/ASX 200 added 0.4 percent.
U.S. Confidence
S&P 500 futures expiring in March rose to 1,293.50, signaling the U.S. equity benchmark may advance for a fifth day. JPMorgan Chase & Co., the most profitable U.S. bank, is scheduled to report earnings today and Wells Fargo & Co., Citigroup Inc. and Goldman Sachs Group Inc. will release results next week.
The Thomson Reuters/University of Michigan preliminary consumer confidence gauge for January probably rose to 71.5, from 69.9 at the end of December, economists surveyed by Bloomberg forecast the group’s data will show today.
The euro touched a one-week high of $1.2879 before Italy sells bonds due in 2014 and 2018. The 17-nation currency is heading for a 1.1 percent climb against the dollar this week, the first advance since the period ended Dec. 2.
“The European liquidity operations are having a positive effect on risk appetite at the moment,” said Chris Weston, an institutional trader at IG Markets Ltd. in Melbourne. “The bond auctions are becoming more positive and yields are declining and that’s having a positive impact on euro.”
China Stocks
The won advanced 0.9 percent to 1,148.40 per dollar after the Bank of Korea kept borrowing costs unchanged at 3.25 percent for a seventh month to support the economy.
The Shanghai Composite Index slid 1.3 percent. The gauge has fallen for the past three days as Credit Suisse Group AG and Royal Bank of Scotland Group Plc said inflation would hamper the government’s ability to ease monetary policy.
“An immediate reserve-ratio cut probably won’t come soon given policy makers’ concern about a possible rebound in inflation,” said Wu Kan, a Shanghai-based fund manager at Dazhong Insurance Co., which oversees $285 million.
Belle International Holdings Ltd. (1880) tumbled 6.9 percent in Hong Kong, the biggest drop in three months. China’s biggest shoe retailer reported slower same-store sales growth.
Oil, Gas
Oil declined 1.6 percent this week. An EU embargo on imports of Iranian oil will probably be delayed for six months to let countries such as Greece, Italy and Spain find alternative supplies, according to an official with knowledge of the talks that declined to be identified because the talks are private.
Natural gas futures in New York fell for a fifth day to trade near the lowest price in more than two years. Gas for February delivery slipped 0.7 percent to $2.677 per million British thermal units on the New York Mercantile Exchange.
Gold for immediate delivery fell as much as 0.9 percent to $1,635.05 an ounce. Silver declined 0.6 percent, palladium dropped 0.7 percent and platinum fell 0.6 percent.
To contact the reporters on this story: Lynn Thomasson in Hong Kong at lthomasson@bloomberg.net; Yoshiaki Nohara in Tokyo at ynohara1@bloomberg.net
To contact the editor responsible for this story: James Regan at jregan19@bloomberg.net
