Bonds climbed, sending Italian and Spanish yields to record lows for a second day, while European stocks advanced and Standard & Poor’s 500 Index futures signaled the gauge will extend yesterday’s record-high close. Gold rebounded and the yen ended a six-day decline.
Italy’s (GBTPGR10) 10-year yield slid five basis points to 2.43 percent at 8:34 a.m. in New York, and Spain’s rate dropped to as low as 2.17 percent. European corporate credit risk fell to the lowest in more than seven weeks. S&P 500 futures rose 0.1 percent, paring gains after a durable goods report. The Stoxx Europe 600 Index added 0.3 percent. The MSCI Emerging Markets Index increased to the highest since 2011. The yen strengthened 0.1 percent against the dollar. Gold for immediate delivery advanced 0.9 percent.
Orders for U.S. durable goods jumped in
July by the most on record as bookings surged for commercial aircraft, the Commerce Department reported. Treasury two-year notes yielded near the most versus similar-maturity German debt since 2007 amid signs of a U.S. recovery and speculation of more stimulus from the European Central Bank. The presidents of Russia and Ukraine began talks in Minsk, Belarus, today as tensions flare in the region.
“The U.S. is on a clear track to tighter policy with gathering economic momentum, while the euro zone continues to deteriorate even after that last round of monetary easing,” Hugh Killen, global head of foreign exchange in Sydney at Westpac Banking Corp., said by instant message.
Spanish 10-year yields tumbled for a sixth day, the longest streak of declines since March. Italy’s yield dropped as low as 2.40 percent.
Bond Risk
The cost of insuring against losses on European corporate debt declined to a seven-week low. The Markit iTraxx Europe index of credit-default swaps on 125 investment-grade companies decreased 3 basis points to 56.5 basis points, the lowest since July 4.More than two shares advanced for every one that declined in the Stoxx 600, with trading 14 percent below the 30-day average, data compiled by Bloomberg show.
WPP Plc (WPP) added 1.7 percent as the advertising agency posted first-half sales that beat analysts’ estimates. Eurazeo SA gained 2.1 percent after its chairman said the French buyout firm is considering some initial public offerings. ArcelorMittal climbed 3 percent after UBS AG recommended buying the stock.
Telecity Group Plc declined 6.8 percent after the operator of data centers said its chief executive will step down in October. Vestas Wind Systems A/S (VWS) slid 4.9 percent after Bank of America Corp.’s Merrill Lynch unit lowered its rating on the world’s largest wind-turbine maker to the equivalent of a sell.
The S&P 500 index (SPX) rose 0.5 percent yesterday, briefly topping 2,000 intraday for the first time in history.
Best Buy
Best Buy Co. dropped 3.6 percent after the world’s largest electronics chain’s revenue missed estimates. Same-store sales, a key measure of a retailer’s performance because new and closed stores are excluded, will decline by a “low single digit” rate in the third and fourth quarter, it said.About 76 percent of those that have posted results this season have beaten analysts’ estimates for profit, while 66 percent exceeded sales projections, according to data compiled by Bloomberg.
Bookings for goods meant to last at least three years climbed 22.6 percent after a 2.7 percent gain in June that was bigger than previously reported, data from the Commerce Department showed today in Washington. A 0.5 percent drop in orders for non-military capital goods excluding aircraft last month followed a June increase of 5.4 percent.
Separate data may show consumer confidence slipped. The Conference Board’s index fell to 89 this month from 90.9 in July, forecasts indicate.
The MSCI Emerging Markets Index added 0.1 percent after closing yesterday at a three-year high. Russia’s Micex slipped 0.3 percent and the ruble was little changed. Ukraine’s hryvnia weakened 0.4 percent and the benchmark equity gauge declined 1.3 percent.
Russian President Vladimir Putin and Ukrainian President Petro Poroshenko began a meeting with the European Union’s foreign-policy chief, Catherine Ashton and the presidents of Belarus and Kazakhstan at a summit in Minsk of the Customs Union, a Russian-led trade bloc. No separate bilateral meeting is planned between them, Russian Foreign Minister Sergei Lavrov said yesterday.
Russian Tanks
Ukraine said yesterday an armored column including 10 tanks entered from Russia as the government in Moscow announced plans to send a second convoy with humanitarian aid into rebel-held Ukrainian territory.The Shanghai Composite Index (SHCOMP) fell for a second day, losing 1 percent, amid concern new initial public offerings may divert funds from existing equities. The 10 companies that will start to market initial public offerings this week, including HMT Xiamen New Technical Materials Co. and Hubei Feilihua Quartz Glass Co., may freeze about 800 billion yuan ($130 billion), according to the Shanghai Securities News.
Pakistan’s benchmark equity gauge dropped 1 percent, extending yesterday’s 1.2 percent decline. Cleric Muhammad Tahir-ul-Qadri, who has been leading a 12-day protest, gave Prime Minister Nawaz Sharif 48 hours to dissolve the parliament and call fresh elections, or face consequences.
Gold climbed to $1,287.48 an ounce in London, rebounding after trading near the lowest since June yesterday. Silver for immediate delivery increased 1.2 percent to $19.5885 an ounce.
West Texas Intermediate crude oil rose 0.2 percent to $93.56 a barrel in New York, after falling 0.1 percent to lowest close since January last session.
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