BLBG:Euro Strengthens After Italy Bill Sale; U.S. Futures Rise Before GDP Data
The euro strengthened for a fifth day against the dollar as borrowing costs fell at an Italian bill sale. U.S. stock-index futures rose and Treasuries declined before a report that may show economic growth quickened.
The euro appreciated 0.3 percent to $1.3144 at 6:40 a.m. in New York, and the Italian 10-year note yield sank 17 basis points. Standard & Poor’s 500 Index futures rose 0.2 percent, and the 10-year U.S. Treasury note yield increased three basis points. The Stoxx Europe 600 Index slipped less than 0.1 percent after falling 0.5 percent. Oil gained 0.5 percent to $100.15 a barrel and copper increased 0.8 percent.
Yields fell to 1.969 percent as Italy sold 8 billion euros of 182-day bills, the lowest level since May and down from 3.251 percent at the previous auction on Dec. 28. European Union Economic and Monetary Affairs Commissioner Olli Rehn said authorities are “very close” to reaching an agreement on private-sector involvement in a Greek debt swap. The U.S. economy probably grew in the fourth quarter at the fastest pace of 2011, economists in a Bloomberg survey said before a Commerce Department report today.
“The auction was quite positive and is therefore supportive for the euro,” said You-Na Park, a foreign-exchange strategist at Commerzbank AG in Frankfurt. “The market is waiting for the summit next week and comments from Germany and France.”
The euro advanced as much as 0.4 percent against the dollar, reversing a 0.2 percent drop. The yen rose 0.5 percent versus the dollar, after climbing as much as 0.7 percent.
Italy Auction
The Italian two-year note yield declined six basis points before the government sells as much as 11 billion euros of bills due in 182 and 331 days. Italy auctioned 182-day bills at a yield of 1.969 percent, down from 3.251 percent at a sale of similar-maturity debt on Dec. 28. The Spanish 10-year bond climbed for the sixth consecutive day, with the yield 21 basis points lower today.
The yield on the Greek 10-year bond rose four basis points to 33.52 percent, with the price falling to 21.15 percent of face value.
The U.S. 30-year bond yield advanced three basis points to 3.12 percent, while the decline in the price of the 10-year Treasury pared a weekly gain. The S&P 500 slipped 0.6 percent yesterday, trimming this week’s advance to 0.2 percent.
Gross domestic product probably grew at a 3 percent annual pace after rising 1.8 percent in the previous three months, the median forecast of 79 economists in Bloomberg survey showed. Household purchases, which make up about 70 percent of the economy, may have climbed 2.4 percent, the data indicated.
Starbucks Earnings
Starbucks Corp. (SBUX) dropped 1.6 percent in German trading after the world’s largest coffee-shop chain reported first-quarter adjusted earnings of 50 cents a share, compared with the average analyst estimate of 49 cents. Juniper Networks Inc. sank 9.7 percent as the second-biggest maker of computer-networking equipment forecast sales and profit that missed estimates.
Sixty-seven percent of the 157 companies in the S&P 500 that have reported results since Jan. 9 have topped analysts’ estimates for per-share profit, according to data compiled by Bloomberg. The gauge is trading at 12.6 times estimated earnings, compared with last year’s low of 11.2 on Aug. 19, data compirled by Bloomberg show.
BNP Paribas SA, France’s biggest bank, retreated 2.7 percent as JPMorgan Chase & Co. downgraded the shares to “neutral” from “buy.” BP Plc lost 1.9 percent as a U.S. judge ruled that the U.K. oil company can’t collect losses caused by the 2010 Gulf of Mexico spill from Transocean Ltd. Transocean jumped 7 percent in pre-market trading.
Brent oil climbed 0.6 percent in London and tin gained 1 percent, making it the best-performing commodity of 80 raw materials, according to data compiled by Bloomberg. Gold advanced 0.2 percent to $1,723.18 an ounce.
To contact the reporters on this story: Stephen Kirkland in London at skirkland@bloomberg.net; Lynn Thomasson in Hong Kong at lthomasson@bloomberg.net;
To contact the editor responsible for this story: Stuart Wallace at Swallace6@bloomberg.net
