Global stocks advanced, rebounding from the biggest loss this year, and the euro rose after Greek lawmakers approved austerity plans to secure rescue funds. The yen fell as Japan’s economy shrank, while oil climbed after shipping companies said they would stop carrying Iranian crude.
The MSCI All-Country World Index (MXWD) added 0.4 percent as of 8:02 a.m. in London. The Stoxx Europe 600 Index rallied 0.6 percent and the Hang Seng China Enterprises Index (HSCEI) jumped 0.6 percent. The euro strengthened 0.4 percent to $1.3255, while the yen dropped against all of its 16 major peers. Oil rose 0.9 percent and copper gained 1 percent. German 10-year bund yields increased four basis points to 1.95 percent.
Passage of the austerity bill puts the spotlight on a meeting of euro-region finance ministers on Feb. 15 that must decide whether to approve the second aid package. Rioters protesting the measures battled police and set fire to buildings in downtown Athens. Japan’s economy contracted an annualized 2.3 percent in the fourth quarter, more than economists estimated, as slumping exports undermined a recovery from last year’s record earthquake.
“Investors have a feeling Greece won’t default,” said Yoshinori Nagano, a senior strategist in Tokyo at Daiwa Asset Management Co., which oversees about $104 billion. “The approval of the bill helped them to take a step toward confidence. There’s now an expectation the second-round aid will be approved.”
Earnings Season
The MSCI All-Country World Index (MXWD) sank 1.2 percent on Feb. 10 after euro-area finance ministers held back a 130 billion- euro ($173 billion) rescue package until Greece approved the austerity plan. The global equity benchmark has climbed 8.5 percent this year.
L’Oreal SA and Deutsche Boerse AG are among companies scheduled to report results today. Per-share profits have beaten analyst estimates at 49 percent of the 923 companies in the MSCI All-Country World Index that released results since Jan. 9, data compiled by Bloomberg show.
Vodafone Group Plc, the world’s largest mobile-phone company, rose 0.2 percent after saying it’s in early stages of evaluating a potential offer for Cable & Wireless Worldwide Plc.
The Hang Seng China Enterprises Index of mainland companies listed in Hong Kong advanced for the first time in three days. Chinese Premier Wen Jiabao said the nation needs to start “fine-tuning” economic policies this quarter, the official Xinhua News Agency reported yesterday.
China Stocks
China Yurun Food Group Ltd. (1068) plunged 20 percent for the biggest drop in the MSCI Asia gauge. The country’s second- largest meat processor reported a 38 percent drop in net profit for 2011, citing “negative” media reports and higher hog costs.
The yen declined 0.5 percent to 102.94 per euro. Japanese Finance Minister Jun Azumi reiterated at a parliamentary budget committee session in Tokyo that he’ll act on excessive and speculative moves in the currency. Japan spent 14.3 trillion yen ($184 billion) in intervention operations last year to stem gains in the currency.
The Australian dollar gained 0.7 percent to $1.0746, snapping three days of losses. Home-loan approvals jumped 2.3 percent in December, the most in seven months, the nation’s statistics bureau reported. The New Zealand dollar climbed 1 percent to 83.52 U.S. cents.
Iran Sanctions
Oil rose as much as 1 percent on the New York Mercantile Exchange. Brent oil for March settlement added 0.9 percent to $118.34 a barrel on the ICE Futures Europe exchange. Sanctions on Iran are tightening after Overseas Shipholding Group, Frontline Ltd. and owners controlling more than 100 supertankers said they would stop loading cargoes from the Organization of Petroleum Exporting Countries’ second-largest producer.
Three-month copper rose as much as 1.3 percent to $8,587.75 a metric ton on the London Metal Exchange. Zinc and aluminum climbed at least 0.7 percent. Spot gold added 0.5 percent to $1,730.30 an ounce.
Hedge funds have increased bets on rising commodity prices to the highest since September on mounting confidence that growth in the U.S. will strengthen demand. Money managers boosted their combined net-long positions across 18 U.S. futures and options by 13 percent to 929,199 contracts in the week ended Feb. 7, Commodity Futures Trading Commission data show.
Yields on 10-year Treasury notes were little changed at 2 percent. U.S. bonds have lost 0.7 percent so far in February, following a 2.1 percent gain over the previous three months, according to a Bank of America Merrill Lynch index.
To contact the reporters on this story: Lynn Thomasson in Hong Kong at lthomasson@bloomberg.net; Norie Kuboyama in Tokyo at nkuboyama@bloomberg.net
To contact the editor responsible for this story: Richard Dobson at rdobson4@bloomberg.net
