A shopper carries a H&M branded shopping bag in Toulouse, France. Hennes & Mauritz AB... Read More
The Stoxx Europe 600 Index added 0.7 percent at 6:36 a.m. in New York, heading for its biggest weekly gain this year. Hong Kong’s Hang Seng Index reached its highest level since 2010. Futures (SPA) on the Standard & Poor’s 500 Index rose 0.2 percent. Spanish and Italian bonds advanced, while measures of European corporate credit risk fell this week. Malaysia’s ringgit strengthened 0.8 percent to a nine-month high and copper climbed. U.K. natural gas rose 0.6 percent.
BHP Billiton Ltd. led a rally in mining stocks after
saying that it will discuss spinning off parts of its business at a board meeting. Global stocks have climbed this week, rebounding from a two-week slide, as signs the economic recovery is slowing stoked bets that central banks will leave interest rates near record lows for longer. In Russia, officials from the International Committee of the Red Cross began inspecting a convoy of trucks sent by the Kremlin to provide humanitarian aid to eastern Ukraine.
“We might have to rely on more European Central Bank policy,” said Thomas Thygesen, head of cross-asset strategy at Skandinaviska Enskilda Banken AB in Copenhagen. “Investors are trying to figure out what kind of correction they witnessed. It could be a risk-sentiment correction where there is no economic fallout from the crisis in Ukraine, or we could have a weaker European economy that is less able to withstand even a modest hit. Next week’s August data is going to be crucial.”
Group Movers
Mining companies led gains on the Stoxx 600 as BHP Billiton rose 2.7 percent. The world’s biggest commodity producer said it will focus on its iron ore, copper, coal and petroleum businesses. The board meets next week to debate a demerger of some of its other assets. Rio Tinto Group and Glencore Plc, the world’s second and third-largest mining stocks, climbed 1.4 percent and 1 percent, respectively.Hennes & Mauritz AB climbed 1.8 percent after the operator of H&M clothing stores announced July sales that exceeded estimates.
Spain’s 10-year yield fell five basis points to 2.43 percent and Italy’s dropped four basis points to 2.62 percent as government bonds across the euro area headed for a weekly advance amid faltering growth and bets inflation will remain subdued. Rates set new euro-era lows from Ireland to Austria after Germany’s 10-year yield slid below 1 percent for the first time yesterday.
Yen Weakens
The yen weakened versus all of its 16 major counterparts today. The Japanese currency has fallen 0.5 percent since Aug. 8 to 102.57 per dollar and has dropped 0.2 percent to 137.21 per euro.The MSCI Emerging Markets Index added 0.1 percent, bringing this week’s advance to 2.7 percent, its biggest rally since March. The Hang Seng China Enterprises Index of mainland shares traded in Hong Kong rose 0.3 percent. The Shanghai Composite Index increased 0.9 percent in its fifth week of gains, the longest winning streak since May 2013.
China may adopt targeted interest-rate cuts for shanty-town redevelopment, the agriculture sector and small companies, according to a front-page commentary today in the China Securities Journal.
Malaysia’s ringgit rallied 0.8 percent to a nine-month high after economic growth unexpectedly accelerated.
The ruble strengthened 0.2 percent.
Natural Gas
U.K. natural gas climbed for a third day. Europe gets about a third of its natural gas from Russia, half of it through Ukraine. Silver for immediate delivery rose 0.1 percent to $19.9057 an ounce. The first London Silver Price to replace the fixing is due to be set today at about noon local time. Copper advanced 0.4 percent to $6,853 a metric ton, the first increase this week. The U.S. is the biggest buyer of the metal after China.The cost of insuring against losses on corporate debt fell, with the Markit iTraxx Europe index of credit-default swaps on 125 investment-grade companies decreasing one basis point to 62.5 basis points, the lowest since July 30. The gauge is heading for the first weekly decline in four weeks.
The Markit iTraxx Crossover Index linked to 60 companies with mostly high-yield ratings fell two basis points to 258 basis points, down 43 basis points this week and heading for the first weekly drop in six weeks and the biggest since October 2011.
Yields on investment-grade corporate bonds in euros fell to a record 1.4 percent, according to Bank of America Merrill Lynch index data.
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