European shares climbed for the first time in four days and U.S. stock index (MXEF) futures gained as Italy’s bond yields fell after a debt sale. Commodities rose. The Stoxx Europe 600 Index advanced 0.5 percent at 11:11 a.m. in London. The Standard & Poor’s 500 index futures added 0.3 percent. Italy’s 10-year bond yield dropped four basis points to 5.07 percent. The S&P GSCI gauge of raw materials added 0.3 percent and the Australian dollar strengthened against its U.S. counterpart. Italy sold 3.75 billion euros ($4.8 billion) of its benchmark three-year bonds at 2.86 percent. Investors bid for 1.67 times the amount offered, up from 1.49 times last month. S&P yesterday cut Spain’s debt rating to one level above junk, citing economic and political risks as the government considers a second bailout. U.S. initial jobless claims rose last week, economists said before a government report. “The Italian auctions were a confidence booster,� said Jamie Searle, a European fixed-income strategist at Citigroup Inc. in London. “You could argue S&P was already out of line with most people’s thinking, so it was really catching up with the rest of the market. The Italian auctions were quite strong.� Burberry Rally The Stoxx 600 (SXXP) snapped three days of losses as luxury goods companies and retailers climbed. Burberry Group Plc, the U.K.’s largest luxury-goods maker, rallied 7 percent after reporting a partial recovery in retail sales growth since September’s profit warning. Christian Dior SA and Cie. Financiere Richemont SA rose more than 2.5 percent. Carrefour SA (CA) climbed 4.4 percent in Paris after the world’s second-largest retailer posted third-quarter sales that beat analyst estimates. Direct Line Insurance Group Plc, a U.K. insurer, added 4.4 percent on the first day of trading following its 787 million-pound ($1.3 billion) initial public offering. Spanish banks including Banco Santander SA and Bankia SA fell at least 1.5 percent. The gain in S&P 500 futures indicated the U.S. gauge will rise for the first time in a week. A report at 8:30 a.m. in Washington may show the number of Americans filing first-time claims for unemployment insurance payments increased to 370,000 last week from 367,000 the previous period, according to the median estimate in a Bloomberg survey of economists. Spanish Yields Spain’s two-year notes were little changed after falling for the past three days, with the yield at 3.27 percent. German bunds rose, pushing the yield two basis points lower to 1.47 percent, as investors sought Europe’s safest government- debt securities. The euro was little changed against the yen at 100.64. The 17-nation currency climbed 0.1 percent to $1.2884. Australia’s dollar rallied 0.5 percent to $1.0285. Soybeans led gains in commodities, rising 1.2 percent. Zinc advanced 0.9 percent and Brent crude climbed 0.7 percent to $115.16 a barrel. U.K. natural gas for same-day delivery fell from its highest level in eight months as increased imports from Belgium offset lower Norwegian supply. The contract fell as much as 1.5 percent to 64.5 pence a therm. The MSCI Emerging Market Index added less than 0.1 percent after dropping as much as 0.5 percent. South Korea’s KOSPI (KOSPI) fell 0.8 percent, heading for its lowest since Sept. 12, as the country’s central bank lowered the benchmark seven-day repurchase rate to 2.75 percent from 3 percent. The Bank of Korea slashed its 2012 economic growth outlook to 2.4 percent from an earlier estimate of 3 percent, citing the protracted European fiscal crisis and the risk of fiscal cliff in the U.S. Taiwan’s gauge slumped 1.9 percent, falling for a third day. The rand extended gains against the dollar amid signs labor unrest that shut gold and platinum mines is easing. The currency has gained 2.1 percent in three trading sessions. To contact the reporter on this story: Claudia Carpenter in London at ccarpenter2@bloomberg.net To contact the editor responsible for this story: Stuart Wallace at swallace6@bloomberg.net

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