BLBG: European Shares Rise as Pound Gains While Oil Fluctuates
European stocks rose, sending the benchmark index above its highest close in five years, and the pound strengthened while U.S. stocks and oil in New York were little changed. Verizon Communications Inc. (VZ) is said to be marketing an unprecedented $49 billion bond offering.
The Stoxx Europe 600 Index advanced 0.3 percent to 310.70 at 9:32 a.m. in New York, above its highest closing level since June 2008. The Standard & Poor’s 500 Index (SPX) slipped 0.1 percent. Britain’s currency jumped 0.3 percent to $1.5785 as a report showed unemployment unexpectedly fell. Treasury 10-year notes rose, pushing the yield three basis points lower to 2.94 percent. West Texas Intermediate oil was up 0.3 percent at $107.76 a barrel after climbing as much as 0.6 percent and losing 0.8 percent.
President Barack Obama asked Congress to delay a vote authorizing the use of military force while the administration pursues a proposal that would have Syria surrender its chemical arms, he said in a speech in Washington. The U.K’s unemployment rate measured by International Labour Organization methods declined to 7.7 percent from 7.8 percent in the second quarter, the Office for National Statistics said.
“Markets probably won’t shoot much higher unless we have more positive catalysts,” said Naoki Fujiwara, Tokyo-based chief fund manager at Shinkin Asset Management Co., which oversees about $6.5 billion. “Syria’s situation was much more unclear last week and investors couldn’t take a position, but now things have turned and they are willing to take more risks. But uncertainties around Syria do remain.”
ARM Climbs
Trading volume in the Stoxx 600 was 29 percent greater than the 30-day average, according to data compiled by Bloomberg. ARM Holdings Plc (ARM), which designs chips for Apple Inc. (AAPL)’s iPhones, soared 5.1 percent after the U.S. company unveiled new models of the device.
The S&P 500 closed at the highest level in almost four weeks yesterday. Apple declined 4 percent in early trading. Shares of the world’s biggest technology company retreated 2.3 percent in New York trading yesterday after it unveiled two new iPhones, including a cheaper version in bright colors and an updated high-end device.
Verizon, the second-biggest U.S. telephone carrier, started an eight-part, $49 billion bond offering, according to a person with knowledge of the sale, who asked not to be identified because terms aren’t set. The transaction would be almost triple the size of Apple’s record $17 billion issue in April.
The company’s $1.75 billion of 2.45 percent notes due November 2022 rose today from a record-low of 83.9 cents on the dollar yesterday, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. The increase pushed the yield down 15 basis points to 4.48 percent.
Emerging Markets
The MSCI Emerging Markets Index was little changed after a five-day rally. The Shanghai Composite Index gained 0.2 percent while the Hang Seng China Enterprises Index of mainland companies listed in Hong Kong decreased 0.6 percent.
The foundations of a rebound aren’t yet solid and China is taking steps to stabilize growth and can achieve the main economic targets this year, Premier Li Keqiang said in a speech today at the World Economic Forum in Dalian, China.
India’s rupee strengthened 0.7 percent versus the dollar and Russia’s ruble added 0.4 percent.
The euro was little changed at $1.3266, after a three-day advance. The yen appreciated 0.2 percent to 100.24 per dollar.
Italy’s 10-year bond yields were above those of Spain for a second day, after rates surpassed those on the Iberian securities yesterday for the first time in 18 months amid speculation a vote on whether to expel Silvio Berlusconi from Italy’s Senate will destabilize the coalition government.
The Italian yield fell one basis point to 4.52 percent. Spain’s decreased two basis points to 4.49 percent.
To contact the reporters on this story: Kyoungwha Kim in Beijing at kkim19@bloomberg.net; Stephen Kirkland in London at skirkland@bloomberg.net
To contact the editor responsible for this story: Lynn Thomasson at lthomasson@bloomberg.net
