Zinc jumps most in four years as Glencore plans output cuts
Dollar Index declines following Fed minutes, as rupiah surges
European stocks followed Asian shares higher, extending a rally that’s added about $2.5 trillion to global equities since last Friday, and emerging-market currencies were set for their biggest weekly gain in more than 17 years, as traders snapped up riskier assets on optimism the Federal Reserve will hold off tightening monetary policy.
The MSCI All-Country World Index was heading for its largest eight-day rally since 2011, with the Stoxx Europe 600 Index up for the sixth straight session. The Indonesian rupiah and Malaysian ringgit led gains by developing-nation currencies, while zinc was on course for the steepest jump on record after Glencore Plc said it will cut production of the metal. Oil in New York rose above $50 a barrel for the second day, and corporate credit risk was set for the longest run of declines since January.
“We’ve seen a real rebound in sentiment and markets,” said Ben Kumar, who helps oversee about $14 billion at Seven Investment Management in London. “There’s a lot of ground to recover before we can say we’re back in an environment that isn’t being traded so violently.”
Global stocks have been staging a comeback in the wake of their worst quarter since 2011 as signs of an uneven recovery in the U.S. job market and data signaling slowing growth from China to Germany heighten speculation the Fed won’t raise interest rates until next year. Alcoa Inc. fell in German trading on Friday after posting earnings that missed analysts’ estimates a day earlier, leaving U.S. equity-index futures little changed.
“Investors don’t quite know which way to read the market,” said Oliver Herington, who sells U.S. shares at London-based brokerage Atlantic Equities LLP. “Everything comes back to concerns about global growth. Alcoa’s miss show that some parts of corporate America are suffering.”
The MSCI global benchmark advanced 0.7 percent at 10:27 a.m. in London, with the Stoxx 600 rising 0.9 percent, headed for its first weekly gain in four. A Bloomberg index tracking 20 emerging-market currencies jumped 3.4 percent in the five days.
Minutes from the Fed’s September meeting released Thursday kept bets for higher rates pushed into next year. That weighed on the dollar and boosted energy, raw-material and industrial companies amid trader expectations that a weaker U.S. currency will lift their profits. The Fed noted that domestic economic conditions had continued to improve, though concern over China and its potential spillover to other economies “were likely to depress U.S. net exports.”
Stocks
Gains by the Stoxx 600 were fueled by miners, energy companies and utilities, with each group rising at least 1.5 percent on the day.
Oil-related companies have gained 13 percent this week, the biggest surge since 2008. Miners have rallied 18 percent, the most since 2009, with Glencore rebounding a record 37 percent. Boliden AB, a zinc producer, jumped 14 percent on Friday as Glencore said it will cut output of the metal by about a third and Nordea Bank AB recommended buying the stock.
The S&P 500 has climbed 3.2 percent this week, the most this year. It closed at its highest level since Aug. 20. Alcoa fell 5.3 percent in Germany.
Emerging Markets
The rupiah, Russia’s ruble and the ringgit were the best performers among developing-nation currencies this week, with gains of more than 6 percent against the dollar. The Indonesian currency rose 3.5 percent on Friday, with the ringgit up 2.6 percent.
The MSCI Emerging Markets Index climbed 1.5 percent on Friday, extending its weekly advance to 7.1 percent. Global funds pumped a net $1.2 billion into shares in Brazil, India, Indonesia, South Korea, Taiwan and Thailand.
Hong Kong’s Hang Seng China Enterprises Index rose 1.2 percent. Shares in Indonesia and Malaysia rose in the week, with Russia’s Micex climbing 6.6 percent, the most in six months. The Shanghai Composite Index climbed 1.3 percent Friday.
Commodities
Zinc for three-month delivery on the London Metal Exchange jumped 10 percent. Copper, aluminum, nickel and lead all rose more than 4 percent. The Bloomberg Commodity Index surged 1.3 percent Friday.
West Texas Intermediate increased 1.8 percent to $50.32 a barrel, headed for its steepest weekly advance since August. Brent crude gained 1 percent Friday to $53.56 a barrel.
