By Justin Carrigan July 20 (Bloomberg) -- Stocks, oil and emerging-market currencies rose, sending the yen and the dollar lower on optimism improved corporate earnings will show the global economy is bottoming. Europe’s Dow Jones Stoxx 600 Index climbed more than 1 percent as of 9:44 a.m. in London, gaining for a sixth straight day, the longest winning streak since March. Crude oil added 1.5 percent for a fourth day of gains. The ruble strengthened 1.9 percent against the dollar, leading a rally in emerging-market currencies. About 76 percent of companies in the Standard & Poor’s 500 Index that have reported earnings since July 8 beat analysts’ estimates. Tata Consultancy Services Ltd., India’s largest software exporter, climbed 16 percent after its earnings topped estimates. Stocks also gained on optimism lender CIT Group Inc. will get emergency loans from creditors to avert bankruptcy. “Corporate profits are beating expectations by their widest margins in a year, pushing most equity markets within a whisker of new year-to-date highs and the dollar toward its 2009 lows,” John Normand, head of global currency strategy at JPMorgan Chase & Co. in London, wrote in a research note. The yen fell 1.7 percent against the New Zealand dollar and 1.6 percent against the Australian dollar. It dropped 1.5 percent compared with the pound. The U.S. dollar declined against every major currency except the yen, and Normand said he expects the U.S. currency to extend its drop this month. Emerging Markets All 22 emerging-market currencies tracked by Bloomberg except Israel’s shekel advanced against the dollar. Malaysia’s ringgit led gains in Asia, rising 1 percent, while South Africa’s rand appreciated 0.9 percent on the rally in commodities and after Absa Group Ltd. Chairwoman Gill Marcus was named as successor to central bank Governor Tito Mboweni. Emerging-market stocks climbed for a fifth day, the longest stretch of gains in 10 weeks. The MSCI Emerging Markets Index increased 2.2 percent to the highest intraday level since June 3. Tata posted the steepest advance in the 22-country gauge after saying first-quarter profit rose 23 percent on lower costs and a weaker dollar that boosted the value of overseas earnings. Oil for August delivery rose 93 cents to $64.49 a barrel on the New York Mercantile Exchange. Refiners in China, the world’s second-largest oil user, raised their operating rates to a 16- month high, according to CBI China, a Shanghai-based commodities researcher. Six-Day Gain The MSCI World Index, a measure for 23 developed nations, climbed 0.7 percent as basic-resource producers and financial firms increased. The gauge is up for a sixth straight day, the longest stretch of gains since May. Futures on the S&P 500 Index rose 0.3 percent and the MSCI Asia Pacific excluding Japan jumped 2.8 percent. Japanese markets were closed for a holiday. Caterpillar Inc., Microsoft Corp. and American Express Co. are among companies scheduled to report results this week. Analysts forecast that earnings in the S&P 500 dropped 33 percent on average in the second quarter. Treasuries fell for a second day, sending the yield on the benchmark 10-year note up 4 basis points to 3.69 percent, the highest level since June 22, as traders bet an index of U.S. leading indicators increased in June for a third month. The Conference Board’s gauge of the economic outlook for the next three to six months probably climbed 0.5 percent, according to the median forecast in a Bloomberg survey of 46 economists. It would be the first time the index has advanced for three consecutive months since 2004. CIT Jumps The U.S., Europe and Japan are grappling with their first simultaneous recessions since World War II after the collapse of subprime mortgages two years ago froze credit markets, spurring about $1.5 trillion in losses and writedowns at financial firms. The U.S. economy will shrink 2.5 percent this year, after growing 1.1 percent last year, according to the median of 61 forecasts compiled by Bloomberg News. CIT, which failed to win additional financial support from the U.S. government last week, jumped 80 percent in Frankfurt trading, following a 54 percent slump last week. Expectations of a deal between CIT and its bondholders “has helped lift investor confidence further after positive earnings reports from the U.S. last week,” Derek Halpenny, European head of global currency research at Bank of Tokyo Mitsubishi UFJ Ltd. in London, said in a report today. Improving sentiment in European credit markets sent default swaps on the high-yield Markit iTraxx Crossover index down by 17 basis points to a five-week low of 685, according to JPMorgan Chase & Co. prices. Credit-default swaps, which are used to hedge against losses and speculate on credit quality, also declined for banks and insurers, with the Markit iTraxx Financial index dropping 5.5 basis points to 101, the lowest since the gauge started trading in March. To contact the reporter on this story: Justin Carrigan in London at jcarrigan@bloomberg.net

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