BLBG:Stocks, Metals Rise on German Confidence Data as Treasuries Drop
European stocks rose to a one-week high and copper gained as German investor confidence increased more than forecast. U.S. Treasuries fell before data forecast to show the fastest American retail sales growth in five months.
The Stoxx Europe 600 Index rallied 1.1 percent at 7:30 a.m. in New York and Standard & Poor’s 500 Index futures added 0.5 percent. The yield on the 10-year Treasury note increased for a fifth day, with the two-year yield reaching a seven-month high. The German bund snapped a two-day gain, while the yen weakened against all 16 major peers. Copper in New York rose 1.2 percent.
The German sentiment gauge from the ZEW Center for European Economic Research advanced to 22.3 from 5.4 in February, more than double the median estimate of 10 forecast in a Bloomberg survey. U.S. retail sales probably rose 1.1 percent in February, economists said before a Commerce Department report today, as the Federal Reserve meets to review monetary policy. European finance chiefs called on Spain yesterday to prune an additional 0.5 percent of gross domestic product out of the 2012 budget.
“We’re starting to feel more confident and it’s going to be a good year,” Kirk West, Sydney-based executive director of international investments at Principal Global Investors, said in a Bloomberg Television interview. The firm oversees about $215 billion in assets.
The Stoxx 600 (SXXP) climbed to the highest level since March 2 as all 19 industry groups advanced. Prudential Plc gained 1.7 percent as the U.K.’s biggest insurer by market value said full- year profit rose 7 percent.
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The increase in S&P 500 futures signaled the gauge may advance for a fifth day. The equity benchmark has rallied 9 percent this year.
Retail sales in the U.S. probably rose 1.1 percent last month after a 0.4 percent gain in January, according to the median forecast of 81 economists surveyed by Bloomberg News. Excluding autos, purchases may have climbed 0.7 percent.
The best six months of job gains since 2006 have helped reduce the odds of a third round of asset purchases by the Fed, according to a Bloomberg News survey of economists.
Trading on American equity exchanges fell to the lowest level of the year yesterday as enthusiasm waned among investors even after the S&P 500 (SPX) rallied 25 percent in five months. Shares changing hands on all exchanges slid 16 percent to 5.23 billion yesterday from March 9, while S&P 500 composite volume slipped 17 percent to 2.17 billion shares, data compiled by Bloomberg show. Those are the lowest daily levels excluding holiday weeks since Bloomberg began tracking the data in 2008.
U.S. Debt Sale
The 10-year Treasury note’s run of declines was the longest since Jan. 24. The government sells $21 billion of the securities today, the second of three auctions this week totaling $66 billion. The yield on the two-year Treasury note climbed to as much as 0.33 percent, the highest since Aug. 4.
The 10-year Italian yield fell five basis points to 4.86 percent as the government sold 12 billion euros ($16 billion) of debt today, meeting its target as borrowing costs declined from the previous auction. Belgium (GBGB10YR) sold 3.256 billion euros of short-term debt, surpassing its 3.2 billion-euro target for the auction as one-year borrowing costs fell to a euro-era low. The Netherlands sold 2.83 billion euros of notes due in April 2015 at an average yield of 0.618 percent.
The 2 percent Greek bond due in February 2023, one of the securities issued as part of the nation’s debt exchange with private investors, declined, with the yield rising 52 basis points to 18.97 percent and the price falling to 26.85 cents on the euro.
Greek Swaps Removed
Greek credit-default swaps were stripped from a benchmark measure of sovereign debt risk after traders last week ruled contracts on the nation can be paid out. The Markit iTraxx SovX Western Europe Index, now linked to swaps on 14 governments, was trading at 226.5 basis points after closing at 353 basis points before Greece was removed yesterday.
The yen depreciated 0.6 percent against the dollar, dropping to an almost 11-month low, while the euro weakened 0.2 percent to $1.3124.
Oil rose 0.4 percent to $106.79 a barrel. Soybeans advanced 0.9 percent and wheat gained 0.9 percent. Trading on the London Metal Exchange was halted because of a computer problem. Natural gas for April delivery fell as much as 6.5 cents to $2.204 per million British thermal units at 8:48 p.m. local time on the New York Mercantile Exchange, the least since February 2002, and last traded at $2.260.
The MSCI Emerging Markets Index (MXEF) advanced 1 percent after sliding 0.9 percent yesterday. Benchmark gauges for China, Taiwan and South Korea jumped more than 1 percent. The BSE India’s Sensitive Index (SENSEX) increased 1.3 percent on speculation the government will deliver a growth-oriented budget this week. The ISE National 100 Index (XU100) rose 0.9 percent in Istanbul. Benchmark indexes in South Africa and Russia gained at least 0.3 percent as prices for oil and industrial metals increased.
To contact the reporters on this story: Stephen Kirkland in London at skirkland@bloomberg.net; Lynn Thomasson in Hong Kong at lthomasson@bloomberg.net
To contact the editor responsible for this story: Mark Gilbert at magilbert@bloomberg.net
