The yen weakened to the lowest level in almost three years against the dollar and Japanese stocks led global shares higher on speculation Prime Minister Shinzo Abe will nominate a central bank chief who favors stimulus. The euro gained as Italy voted in general elections. The yen depreciated 0.4 percent to 93.79 per dollar at 6:15 a.m. in New York and earlier traded at its lowest level since May 2010. The euro strengthened 0.6 percent to $1.3273 and Italian bonds advanced. The Nikkei 225 Stock Average (NKY) surged 2.4 percent to its highest level since September 2008, helping the MSCI All-Country World Index gain 0.5 percent. Standard & Poor’s 500 Index futures increased 0.4 percent. Silver climbed 1.7 percent and U.K. natural gas jumped to a one-year high. Abe is likely to call on Asian Development Bank President Haruhiko Kuroda, who said this month there is “substantial room� for easing, and Kikuo Iwata as his deputy, according to two officials with knowledge of the discussions. Initial estimates of Italy’s election results are due after 3 p.m. in Rome, with Pier Luigi Bersani the front-runner in opinion surveys two weeks ago. “The market seems to have formed an opinion that Kuroda is a dove and if he indeed becomes the new BOJ governor, he would be willing to do much more to support growth,� said Geoffrey Yu, a senior currency strategist at UBS AG in London. “The yen is weakening on speculation that there will be more policy easing.� The yen weakened against all 16 of its major peers, losing 1 percent versus the euro. Japan’s currency has dropped 6.7 percent this year, the biggest loser among 10 developed-nation currencies tracked by Bloomberg Correlation-Weighted Indexes. The pound has seen the second-biggest decline, falling 5.9 percent. U.K. Downgrade The euro advanced against 12 of its 16 main counterparts. The yield on Italy’s 10-year note fell three basis points to 4.42 percent and the rate on Spain’s bond slipped one basis point to 5.14 percent. Sterling slipped 0.7 percent today to 87.57 pence per euro, after depreciating to the weakest level since October 2011. Moody’s Investors Service lowered Britain’s credit rating on Feb. 22 by one level to Aa1 from Aaa. Chancellor of the Exchequer George Osborne said he won’t give in to opposition calls to drop austerity policies after the downgrade. The cost of insuring against default on corporate debt fell to the lowest in almost a month, with the Markit iTraxx Europe index of credit-default swaps linked to 125 investment-grade companies declining 2.5 basis points to 110.5. The Stoxx Europe 600 Index (SXXP) added 0.4 percent as three shares advanced for every one that fell. PostNL NV rallied 7.6 percent as the Dutch postal operator reported earnings that topped estimates. Elan Corp. surged 9.2 percent as RP Management LLC, an investor in royalty streams from pharmaceuticals, said it’s willing to buy the Irish drugmaker for about $6.5 billion. Reckitt Benckiser Reckitt Benckiser Group Plc slid 3.5 percent, the most in nine months, as U.S. regulators approved two rival generic versions of its Suboxone heroin-dependency treatment. The advance in S&P 500 futures indicated the U.S. gauge will extend Feb. 22’s 0.9 percent rally. Investors are awaiting U.S. data this week including the Institute for Supply Management’s factory index, durable goods orders, household spending, the S&P/Case-Shiller index of home prices and fourth- quarter gross domestic product. Federal Reserve Chairman Ben S. Bernanke is due to testify before lawmakers tomorrow and the next day. U.S. Commerce Department data on Feb. 26 may show new-home sales climbed in January, according to a Bloomberg survey. U.S. GDP probably expanded at a 0.5 percent annual rate in the fourth quarter, compared with the Commerce Department’s initial estimate on Jan. 30 that the economy contracted by 0.1 percent. The data will be released on Feb. 28. Metals Drop The S&P GSCI gauge of 24 commodities gained 1.1 percent, rebounding after last week’s 2.6 percent drop, the biggest in 11 weeks. Silver advanced for a third day, the longest streak in a month. Copper jumped 1.2 percent. U.S. crude climbed 1.1 percent to $94.21 per barrel as Iran prepares to meet the U.S., China, France, Germany, Russia and the U.K. in Kazakhstan tomorrow to discuss its nuclear program. U.K. natural gas for next-day delivery reached 76 pence a therm, the most in more than a year, as demand rose on colder-than- average weather. U.S. natural gas jumped 2.6 percent. The MSCI Emerging Markets Index (MXEF) rose 0.3 percent. The Shanghai Composite Index advanced 0.5 percent, while South Korea’s Kospi Index and Taiwan’s Taiex Index both slipped 0.5 percent. Russia’s Micex Index climbed 0.5 percent and India’s Sensex added less than 0.1 percent. Benchmark gauges advanced at least 0.8 percent in South Africa, the Czech Republic, Indonesia and the Philippines. To contact the reporters on this story: Stephen Kirkland in London at skirkland@bloomberg.net; Richard Frost in Hong Kong at rfrost4@bloomberg.net; To contact the editor responsible for this story: Justin Carrrigan at jcarrigan@bloomberg.net

Source