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The Stoxx Europe 600 Index climbed 0.3 percent at 7:10 a.m. in New York. Standard & Poor’s 500 Index futures added 0.1 percent. The yield on Italy’s 10-year bond increased three basis points to 2.01 percent. The dollar strengthened 0.1 percent to 119.94 yen. The ruble weakened, paring yesterday’s gains, even as President Vladimir Putin called for “harsh” steps against speculators. Copper climbed 0.8 percent. West Texas Intermediate crude slipped 0.2 percent, staying lower after Saudi Arabia cut
all January oil prices to the U.S. and Asia. Chinese shares surged the most since 2012.
Global bond yields are holding near historic lows before ECB President Mario Draghi comments on policy today amid speculation authorities are moving closer to buying government debt to combat deflation. Ten-year gilts stayed higher after the Bank of England kept rates unchanged today, in line with analysts’ estimates. Investors are also awaiting U.S. payroll reports tomorrow after private data yesterday showed steady hiring and accelerating services growth.
“The assumption these days is that constantly disappointing macro data in the euro-area makes the probability of Draghi doing something more likely,” Henrik Drusebjerg, who helps manage 14 billion euros ($17 billion) as chief strategist at Carnegie Investment Bank AB in Copenhagen. “My guess is that markets have maybe over interpreted that and expect more than they will get today.”
Ryanair Forecast
Travel companies rose the most among 19 industry groups in the Stoxx 600. Ryanair Holdings Plc added 8.7 percent after raising its annual earnings forecast for the third time this year. EasyJet Plc climbed 2.3 percent after reporting an increase in passengers traveling in November. TUI AG advanced 2.3 percent after its U.K. unit TUI Travel Plc posted a gain in operating profit as the two companies prepared to merge.Unilever climbed 3.2 percent after saying it will separate its spreads business into a standalone unit. The maker of Dove soaps doesn’t plan to sell or spin off the business, it said.
The MSCI Emerging Markets Index climbed 0.6 percent, led by energy producers.
The Shanghai Composite Index jumped 4.3 percent, extending gains to 19 percent over the past month, the most among 93 global equity indexes. Trading volumes in the gauge were 85 percent higher than the 30-day average. The Hang Seng China Enterprises Index of mainland shares traded in Hong Kong advanced 3.8 percent.
The rally, which has coincided with increased use of leverage, is spurring mainland investors to open share accounts at the fastest pace in three years and sending trading values to record highs.
Putin Warning
The ruble slipped 1 percent after gaining as much as 2.3 percent. Putin, in his annual speech to parliament, said “the authorities know who these speculators are and the instruments we can use to influence them. The time has come to use these instruments.” He also announced plans for an amnesty on capital returning to Russia as he tries to shore up a nation threatened by a spiraling economic crisis.The ruble rallied earlier after the central bank reduced the rate it charges banks to borrow foreign currency in a bid to slow the ruble’s slide and ease a dollar shortage.
Mild Weather
Natural gas futures fell a fifth day in New York as unusually mild December weather crimped demand for the heating and power-plant fuel. Gas withdrawals from storage last week were probably below the five-year average, based on analyst estimates compiled by Bloomberg. January delivery contracts dropped 0.9 percent to $3.7705 per million British thermal units on the New York Mercantile Exchange. The fuel fell 1.2 percent in London for the seventh straight decline, the longest run since March.The dollar approached 120 yen as it reached a seven-year high. Some $3.01 billion in options contracts with strikes at 120 yen per dollar expire today, according to data compiled by Bloomberg. The U.S. currency appreciated 14 percent against the yen this year as the Federal Reserve moves closer to raising interest rates while the Bank of Japan adds to monetary stimulus measures.
The U.S. currency gained as much as 0.2 percent to 119.98 yen. The dollar hasn’t breached 120 since July 2007.
Australia’s dollar slid for a sixth day after Goldman Sachs Group Inc. forecast it would decline to 79 U.S. cents in the next year. The median estimate of analysts surveyed by Bloomberg is for the currency to weaken to 82 cents at the end of 2015.
The Aussie fell 0.5 percent to 83.63 U.S. cents after dropping to 83.59 cents, the weakest level since July 2010
Bonds in the Bank of America Merrill Lynch Global Broad Market Sovereign Plus Index had an effective yield of 1.37 percent. The figure has been less than 1.4 percent for almost two weeks. It fell to 1.33 percent in October, the lowest level since May 2013.
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