Yen weakens with Treasuries as stabilizing China hits havens Commodities head for longest rising streak since August Stocks climbed around the world and commodities headed for a third day of gains as investors drew solace from reports showing a stabilization in China’s manufacturing activity. The yen and Treasuries slipped as haven demand ebbed. The Stoxx Europe 600 Index rose for a second day, while futures on the Standard & Poor’s 500 Index advanced as the Chinese purchasing managers indexes, while still signaling a contraction, came in ahead of estimates. The MSCI All Country World Index climbed after its biggest quarterly loss in four years. Glencore Plc advanced a third day, wiping out this week’s loss. The Australian dollar strengthened against most peers as the China data gave a lift to the currencies of commodity-producing nations and oil. Investors are welcoming signs of stabilization in China after concerns about a slowdown in the world’s second-largest economy helped trigger declines that wiped about $10 trillion from global stock values in the three months to Sept. 30. The prolonged contraction in the country’s factory indexes comes even after five interest-rate cuts since November and as the government eases restrictions on real-estate purchases and car sales. Japan’s quarterly Tankan surveys showed businesses are on edge amid faltering domestic growth, angst about China and uncertainty concerning when the Federal Reserve will increase U.S. borrowing costs. “Global risk sentiment is swinging between optimism and pessimism on a near-daily basis as nervous market participants evaluate whether the volatility seen in late August is just a bad memory or will prove to be a harbinger of larger trouble down the track,� Sharon Zollner, a senior economist in Auckland at ANZ Bank New Zealand Ltd., said in a client note. “Markets will likely continue to zig zag until we get a clear signal one way or another.� Stocks The Stoxx 600 advanced 1.2 percent by 8:21 a.m. in London, with basic reources firms leading gains among the 19 industry groups on the gauge. Glencore jumped as much as 8.2 percent to 99.09 pence. The commodity trader plunged 29 percent on Monday. S&P 500 futures erased a drop of as much as 0.4 percent to rise 0.9 percent, with contracts on the Nasdaq 100 Index jumping 1.3 percent. The S&P 500 jumped 1.9 percent Wednesday, trimming its decline in the third quarter to 6.9 percent. The measure joined MSCI’s gauge of global stocks and the Asia Pacific measure to post its worst three months since 2011. The MSCI Asia Pacific Index added 1.5 percent, extending Wednesday’s 2.3 percent rebound. The gauge slid 15 percent last quarter, its worst performance since the same period of 2011. China’s Shanghai Composite recorded the biggest drop of any major global index in the period, followed closely by the Hang Seng China Enterprises Index of Hong Kong-listed mainland companies. China’s markets are closed for a week, while Hong Kong’s will reopen Friday. Taiwan’s benchmark index added 1.4 percent Thursday. Japan’s Topix index climbed 2.2 percent after capping its first three-month slump in six quarters. The gains came even as the Tankan gauge of large manufacturers fell to 12, below the 13 level projected by economists. The S&P 500 capped its first back-to-back quarterly decline in four years Wednesday after China’s shock currency devaluation and concerns about the valuations of some of the gauge’s best-performing sectors sparked its first correction since 2011 in August. China’s official manufacturing PMI rose from 49.7 in the previous quarter. While economists had predicted it would be unchanged, readings below 50 are a sign of contraction. “Markets are not panicking right now because it hasn’t been an across-the-board slump in a continued way,� Vishnu Varathan, a Singapore-based economist at Mizuho Bank Ltd, said of the China PMI figures. “If anything, people see a bit of a silver lining in this data. It was the large manufacturers that lifted the so-called official PMI. The large enterprises showed a very encouraging turnaround in conditions." The private Caixin China manufacturing PMI came in at 47.2, slightly ahead of the 47 preliminary reading last week that was the lowest since 2009, underscoring the challenges faced by the world’s second-largest economy as its traditional growth engines sputter. Final numbers are due Thursday. The early reading of the Caixin gauge will be discontinued from this month, compiler Markit Economics said in a statement. Currencies Australia’s dollar was stronger against 13 of 16 major peers, heading for its biggest two-day gain versus the yen since Sept. 10. The Aussie bought 70.53 U.S. cents, while its New Zealand counterpart climbed 0.1 percent to 64.04 U.S. cents. Canada’s currency advanced 0.3 percent and the South African rand increased 0.9 percent. The yen was lower for a second day, trading at 120.09 per dollar, as the better-than-estimated China data combined with speculation that Bank of Japan Governor Haruhiko Kuroda may need to add to its record stimulus program amid signs the recovery under Prime Minister Shinzo Abe is stalling. The yen has weakened 9.3 percent since the BOJ boosted stimulus at the end of October 2014. “The economic assessments by the government and central bank seem too optimistic,� said Kazumasa Iwata, a BOJ deputy governor from 2003-2008, said in an interview Wednesday. “Listening to Kuroda makes you think there is no need for further easing but the real economy is worse than expected. It’s moving in a direction where the BOJ has to do something.� The euro weakened 0.3 percent to $1.1148. A final reading on European manufacturing activity is due, while Spain, France and the U.K. plan to sell bonds Thursday. The yield on 10-year U.S. Treasuries rose two basis points after sliding for three days. The rate plunged more than 30 basis points during the third quarter as the slowdown in China and the Fed’s referencing of global outlook concerns in its decision to stand pat on rates drove investors to haven assets. Commodities The Bloomberg Commodity Index rose for a third day, climbing 0.4 percent in its longest streak of gains since Aug. 31. West Texas Intermediate crude added 1.6 percent to $45.80 a barrel after see-sawing between gains and losses this week. Prices averaged $46.50 last quarter, the least since the first three months of 2009, as U.S. crude inventories expanded and Iraq, OPEC’s second-largest producer, increased output. Copper on the London Metal Exchange advanced 1.1 percent, extending a 3.8 percent surge yesterday. The metal jumped Wednesday as an Anglo American Plc and Glencore Plc venture said it plans to reduce production at Chile’s second-biggest mine. Nickel for three-month delivery fluctuated in London, after jumping 5.3 percent Wednesday. Last session’s advance trimmed nickel’s third-quarter loss to 13 percent. China is the world’s biggest consumer of industrial metals. As well as the swag of manufacturing PMIs, updates on consumer prices in Indonesia and Thailand are due Thursday.

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