Credit Agricole, Schneider results beat analyst estimates Shares fell in Asia after China lowered the yuan's fixing Share on Facebook Share on Twitter European stocks gained and oil rose as investors looked past losses in Asian markets triggered by a weakening yuan. Shares advanced in Europe as companies including Credit Agricole SA and Schneider Electric SE reported better-than-estimated results and Standard & Poor’s 500 Index futures signaled the gauge will extend the best two-day rally in more than five months. Treasuries and the yen erased gains as haven demand cooled. Asian equities fell with South Korea’s won after China lowered the yuan’s daily fixing by the most in more than a month. “I’d love to think this is the start of a lasting rebound but it’s too early to tell,� said Justin Urquhart Stewart, co-founder of Seven Investment Management in London. His firm oversees about $13 billion. “Any gains have been pretty fragile and short-lived lately, even though earnings haven’t been all that bad and economic figures have been quite supportive.� Central bank attempts to calm global markets this year amid unprecedented volatility have had mixed success as investors grappled with concern China’s slowdown will deepen. Minutes of the Federal Reserve’s most recent meeting, where officials indicated they were monitoring the turmoil in markets, are due Wednesday. Chair Janet Yellen has subsequently indicated the global ructions may delay further tightening of U.S. monetary policy. New-home construction in the U.S. unexpectedly cooled in January, a Commerce Department report showed. Stocks The Stoxx Europe 600 Index rose 1.8 percent at 8:35 a.m. in New York. Credit Agricole led a rebound in lenders, rallying 15 percent after also saying it will sell back stakes in regional banks to shore up capital. Schneider Electric added 8.5 percent after saying it will buy back 1.5 billion euros ($1.7 billion) in shares. Glencore Plc pushed a gauge of commodity stocks higher, advancing 8.6 percent after the Swiss trader said it won new loan commitments from banks to replace an existing $8.45 billion revolving credit facility. Its bonds also gained. Total SA dropped 1.7 percent after a shareholder sold a stake at a discount. ABN Amro Group NV bucked the banking industry trend, slipped 0.7 percent after its quarterly profit missed analysts’ projections as regulatory costs rose. S&P 500 futures added 0.7 percent. Housing starts dropped 3.8 percent to a 1.1 million annualized rate in January, the weakest in three months. The median of 76 estimates in a Bloomberg survey was 1.17 million. Another report will probably show industrial production improved in January, according to forecasts compiled by Bloomberg. The MSCI Asia Pacific Index dropped for the first time in three days, with Japan’s Topix sliding 1.1 percent. Emerging Markets The MSCI Emerging Markets Index was little changed. The Shanghai Composite Index rose 1.1 percent, after jumping 3.3 percent on Tuesday following record bank lending data. The Hang Seng China Enterprises Index of mainland shares traded in Hong Kong fell 1.2 percent on Wednesday as UBS Group AG and Bocom International Holdings Co. said China’s lending surge can’t continue. S&P said the increase in debt relative to gross domestic product could pressure the country’s credit rating. The yuan fell 0.13 percent to 6.5270 per dollar, according to China Foreign Exchange Trade System prices. The People’s Bank of China cut its reference rate by 0.16 percent to a one-month low of 6.5237, surprising some analysts who had forecast smaller moves ahead of a Group of 20 meeting next week. That unsettled Asian markets, with Malaysia’s ringgit dropping 1.5 percent and South Korea’s won sliding 0.9 percent. Indonesia’s rupiah lost 0.8 percent ahead of a policy review on Thursday where the central bank is forecast to lower interest rates for a second time this year. A gauge of 20 developing-market currencies reversed earlier losses amid gains in emerging Europe, Africa and Latin America. Russia’s ruble rose 1.7 percent, while South Africa’s rand and Brazil’s real strengthened 0.9 percent. Commodities West Texas Intermediate crude rose 3 percent to $29.92 a barrel, after sliding 1.4 percent on Tuesday on news of a Saudi-Russia output agreement, the first significant cooperation between OPEC and non-OPEC producers in 15 years. Brent advanced 3.1 percent to $33.21. Iran’s Oil Minister Bijan Namdar Zanganeh will meet with counterparts from Iraq, the second-biggest OPEC producer, and Venezuela on Wednesday, the Iranian news agency Shana said. Gold rose 0.6 percent to $1,206.83 an ounce, halting a three-day drop. Currencies The yen was 0.1 percent weaker at 114.22 per dollar, after earlier climbing as much as 0.6 percent. The pound erased losses against the euro after a report showed U.K. wage growth unexpectedly accelerated in the three months through December. The currency was little changed at 77.85 pence per euro, after earlier weakening as much as 0.7 percent. Bonds The yield on U.S. 10-year Treasuries increased four basis points to 1.81 percent, after earlier reaching 1.74 percent. Germany’s 10-year bund yield was at 0.27 percent after the government auctioned 5 billion euros ($5.6 billion) of 2026 bonds at an average yield of 0.26 percent, the least since April. U.K. 10-year bonds fell, sending the yield three basis points higher to 1.47 percent. The British government sold 2.75 billion pounds ($3.9 billion) of similar-maturity gilts at a record-low auction rate of 1.59 percent. The cost of insuring investment-grade corporate debt declined for a fourth day, with the Markit iTraxx Europe Index of credit-default swaps dropping one basis point to 113 basis points. A measure of non-investment grade swaps fell eight basis points to 447 basis points.

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