BLBG: Stocks Rise on Economy Data, Spain Bond Sale
European stocks and U.S. index (SHCOMP) futures rallied as Spain raised almost double its target at a debt sale and data on jobless claims and New York-area manufacturing signaled a strengthening U.S. economy. The euro rebounded from an 11-month low. Spanish and Italian bonds rose.
The Stoxx Europe 600 Index climbed 1.5 percent at 9:03 a.m. New York time after losing 2.1 percent yesterday. Standard & Poor’s 500 Index futures gained 1.1 percent. Spanish five-year yields fell 29 basis points and the euro strengthened versus the dollar for the first time this week. Nickel, copper and aluminum led commodities higher. Treasuries fell, with the 10-year note snapping a three-day rally.
U.S. index futures extended gains after initial jobless claims unexpectedly dropped to a three-year low and the Federal Reserve Bank of New York’s manufacturing index reached a seven- month high. Spain sold 6 billion euros ($7.8 billion) of bonds, exceeding a 3.5 billion-euro target. A Markit Economics report showed European services and manufacturing output contracted less than economists in a Bloomberg survey had forecast in December.
The S&P 500 was poised to snap a three-day losing streak. FedEx Corp. rallied 4.3 percent in pre-market trading after the world’s largest cargo airline’s 76 percent jump in earnings topped analysts estimates. Boeing Co. climbed as FedEx said it ordered 27 of the company’s 767 jet freighters to retire older planes.
A report today may show U.S. industrial production increased 0.1 percent last month after advancing 0.7 percent in October, according to the median projection of 82 economists surveyed by Bloomberg News.
European Shares
Nine stocks gained for every one that fell in the Stoxx 600. Old Mutual Plc (OML) climbed 11 percent after the third-biggest U.K. insurer said it plans to sell its Nordic unit to Skandia Liv for 2.1 billion pounds ($3.3 billion) to reduce debt and return capital to shareholders.
The euro rose 0.4 percent to $1.3040 after falling to $1.2946 yesterday, its lowest level since Jan. 11. It traded at 101.45 yen. The franc gained 0.9 percent against the euro after Swiss National Bank policy makers, led by Philipp Hildebrand, kept the minimum exchange rate at 1.20 francs per euro at a meeting in Zurich.
Five-year Spanish notes rose for a fifth straight day, pushing yields down to 4.67 percent, and rates on similar- maturity Italian debt slid 28 basis points to 6.54 percent. Treasury 10-year yields rose three basis points to 1.93 percent.
Default Swaps
The cost of insuring sovereign debt was little changed, with the Markit iTraxx SovX Western Europe Index of credit- default swaps linked to 15 governments retreated 6.4 basis points to 377.
Gasoline climbed 1 percent to $2.5293 a gallon. Oil increased 0.5 percent to $95.45 a barrel in New York. Aluminum climbed 1.6 percent to $1,993 a metric ton. The S&P GSCI index of 24 commodities was 0.5 percent higher, after yesterday’s 4.1 percent drop, its biggest tumble since Sept. 22
The MSCI Emerging Markets Index slid for a sixth day, falling 0.3 percent. The Shanghai Composite Index sank 2.1 percent to the lowest level since March 2009. The Dubai Financial Market General Index retreated 1.3 percent, the most in six weeks, after the United Arab Emirates and Qatar failed for a second time this year to secure an upgrade to emerging- market from frontier status at MSCI Inc. Qatar’s QE Index slipped 0.2 percent.
The yuan dropped for a third day after the People’s Bank of China set its daily fixing 0.04 percent weaker at 6.3421 per dollar. The currency, which is allowed to fluctuate as much as 0.5 percent on either side of the central bank’s reference rate, fell 0.05 percent to 6.3735 in Shanghai, the weakest level since Nov. 30, according to the China Foreign Exchange Trade System.
The Nikkei 225 Stock Average (NKY) retreated 1.7 percent as Toyota Motor Corp. and shipping companies fell. The Tankan large manufacturer index slid to minus 4 from 2, the Bank of Japan (8301) said. The median estimate of 24 economists surveyed by Bloomberg News was for a reading of minus 2. A negative number indicates that pessimists outnumber optimists.
To contact the reporters on this story: Paul Dobson in London at pdobson2@bloomberg.net; Inyoung Hwang in New York at ihwang7@bloomberg.net
To contact the editor responsible for this story: Nick Baker at nbaker7@bloomberg.net
