BLBG:Dollar Gains as Bonds Fall; Oil Climbs to Five-Week High
The dollar strengthened against most of its major peers and bonds fell before data that may help investors gauge the outlook for U.S. stimulus. Oil climbed to a five-week high in New York, European stocks declined and Australia’s currency weakened.
The Bloomberg U.S. Dollar Index climbed 0.2 percent at 6:13 a.m. in New York. The Aussie dropped 1.3 percent against the greenback after economic growth slowed. Germany’s 10-year bund yield added two basis points to 1.75 percent. The Stoxx Europe 600 Index slid 0.3 percent, led by banks. Standard & Poor’s 500 Index (SPX) futures rose 0.1 percent, signaling the gauge may snap a three-day slump. West Texas Intermediate oil jumped 1.2 percent to $97.16 a barrel as OPEC ministers met in Vienna.
U.S. companies probably added the most jobs last month since June, a private survey today may show, according to a Bloomberg poll, while data on the nation’s services industries and new home sales are also due. Another report showed the euro area’s nascent recovery from a record-long recession nearly stalled in the third quarter.
“The U.S economy is surprisingly strong,” said Carl Hammer, a currency strategist at SEB AB in Stockholm. “All barometers are signaling good momentum.”
Beige Book
The Federal Open Market Committee meets Dec. 17-18 to discuss policy after minutes of their last meeting in October showed officials may reduce their $85 billion of monthly bond buying should the U.S. economy improve as anticipated. The Fed is scheduled to release its Beige Book report on economic conditions in its 12 districts today.
The dollar advanced against 10 of its 16 major counterparts. It was little changed at $1.3592 per euro. Canada’s dollar fell to a three-year low of C$1.0674 before the nation’s central bank sets policy today.
The Aussie retreated at least 0.6 percent against its main peers. Third-quarter gross domestic product advanced 0.6 percent from the prior three months, less than economists’ forecast for a 0.7 percent gain.
The yield on 10-year U.K. gilts increased two basis points to 2.84 percent, and the rate on similar-maturity U.S. Treasury notes climbed two basis points to 2.80 percent.
Three shares fell for every two that advanced in the Stoxx 600, with trading volumes 10 percent above the 30-day average, according to data compiled by Bloomberg.
Standard Chartered
Banks led losses, with Standard Chartered Plc retreating 6.6 percent after saying full-year operating profit at its consumer-banking unit will drop at least 10 percent.
Six companies agreed to pay European Union antitrust fines totaling a record 1.7 billion euros ($2.3 billion) for rigging benchmark rates to profit their own trades, according to the EU. Deutsche Bank AG was fined 725 million euros, the biggest fine in the case. Its shares slid 1 percent.
Tesco Plc advanced 1.6 percent after the largest U.K. retailer reported that sales matched the median analyst estimate in a Bloomberg survey.
Gagfah SA, the second-biggest owner of German homes, lost 4 percent after an investor sold shares. Elekta AB (EKTAB) dropped 4.3 percent after the Swedish manufacturer of radiation-surgery equipment reported quarterly profit that missed forecasts.
In the U.S., a private jobs report by ADP Research Institute at 8:15 a.m. New York time may show employers added 170,000 workers last month, according to the median forecast of economists in a Bloomberg survey. Labor Department data on Dec. 6 will probably indicate the unemployment rate fell to 7.2 percent, matching the lowest level in five years.
Services Slow
The Institute for Supply Management’s non-manufacturing index probably fell to 55 in November from 55.4 a month earlier, another survey showed. The Commerce Department will publish new home sales figures for both September and October today, after a 16-day government shutdown delayed earlier data.
The MSCI Emerging Markets Index fell for a third day, slipping 0.4 percent. Benchmark gauges in the South Korea, the Philippines, Indonesia and the Czech Republic slipped at least 1 percent. Ukrainian stocks declined for a seventh day, the longest run of losses in more than two years, amid the largest anti-government protests in almost a decade.
The Shanghai Composite Index (SHCOMP) jumped 1.3 percent to the highest level since Sept. 12, led by companies linked to Shanghai’s free-trade zone after the central bank said it plans to implement reform measures for the area within three months.
WTI rose for a fourth day in the longest rally since August. OPEC ministers are forecast to keep production quotas unchanged. Crude extended yesterday’s gains in New York after TransCanada Corp. said it will start part of its Keystone XL pipeline January that could relieve a supply bottleneck, and the American Petroleum Institute said crude stockpiles shrank. Brent crude for January settlement was little changed at $112.60 a barrel on the London-based ICE Futures Europe exchange.
Gold for immediate delivery fell as much as 0.9 percent to $1,212.47 an ounce in London trading, the lowest intraday price since July 5. The precious metal traded recently at $1,215.82. Spot silver dropped as much as 1.2 percent to $18.9003 an ounce, declining for a third day to the lowest since July 8. It was recently at $18.9775.
To contact the reporters on this story: Richard Frost in Hong Kong at rfrost4@bloomberg.net; Emma O’Brien in Wellington at eobrien6@bloomberg.net
To contact the editor responsible for this story: Stuart Wallace at swallace6@bloomberg.net
