Stocks Advance With Commodities on Signs of Economic Revival

Stocks Advance With Commodities on Signs of Economic Revival
Nick Gentle Stephen Kirkland
September 3, 2015 — 6:43 AM HKT Updated on September 3, 2015 — 5:53 PM HKT

Stocks rose in Europe with commodities amid signs the economic recovery was gaining traction.
European shares climbed for a second day after a gauge of the manufacturing and services industries in the euro area increased to the highest level since May 2011. Copper led gains in industrial metals. Sweden’s krona strengthened to a six-week high versus the euro after the central bank signaled its unprecedented stimulus is helping steer the country out of a deflationary trap.
Equities are rising around the world as a two-day holiday in China provides a respite from the country that’s been at the center of recent global volatility. With attention able to shift back to regional markets, investors will be looking at European Central Bank forecasts on Thursday to gauge growth prospects and U.S. payrolls data on Friday for clues as to the timing of raising interest rates.
“With China out a couple of days it allows things to settle down a bit and for people to reassess” fundamentals, said Frances Hudson, Edinburgh-based global thematic strategist at Standard Life Investments, which oversees $383 billion. “So this is buyers being tempted back in with some of the prices being low enoughs to be attractive.”

Stocks

Commodity producers led the Stoxx Europe 600 Index up 1.3 percent at 10:52 a.m. in London. Standard & Poor’s 500 Index E-mini futures expiring this month rose 0.3 percent after the gauge rebounded 1.8 percent on Wednesday.
A Purchasing Managers’ Index for manufacturing and services rose to 54.3 in August from 53.9, London-based Markit Economics said. That exceeds an Aug. 21 estimate of 54.1. A reading above 50 indicates expansion.
EasyJet Plc advanced 6.4 percent after the budget airline raising its annual earnings forecast. Syngenta AG added 3.2 percent after saying it will buy back more than $2 billion of shares and sell its vegetable seeds business.
Global equity volatility climbed to its highest level since 2011 earlier in the week, as signs China’s economy may be headed for a steeper slowdown than the government forecast fueled anxiety over the global outlook. While losses in the Shanghai Composite Index have been mitigated by regulators before this week’s holiday, the gauge’s movements have held sway over sentiment toward equities around the world. 
(For more news on stocks, see TOP STK.)

[You must be registered and logged in to see this image.]

Emerging Markets

The MSCI Emerging Markets Index advanced for the first time in four days, rising 0.3 percent, as benchmark gauges in India, Poland, Hungary, South Africa and Dubai gained more than 1 percent.
“One modest positive today is the fact China is offline for its Victory Day commemorations,” said Chris Weston, Melbourne-based chief markets strategist at IG Ltd. “So traders and investors will be focused on domestic data, valuations and trying to understand how to navigate these crazy markets.”
Two shares rose for every one that fell in the MSCI index, which has dropped more than 9 percent since China devalued the yuan on Aug. 11. Chinese markets are shut Thursday and Friday to commemorate the end of World War II.
Malaysia’s ringgit and South Korea’s won weakened at least 0.8 percent, leading declines in developing-nation currencies.
(For more news on emerging markets, see TOP EM.)

Currencies

Sweden’s krona strengthened after the Riksbank kept its repo rate at minus 0.35 percent and said existing policies were “supporting the continued positive development of the Swedish economy.” It also said it was ready to expand monetary stimulus if needed.
The krona gained 0.8 percent to 9.3922 per euro and reached 9.3852, the strongest level level since July 23. It appreciated 0.9 percent to 8.3575 per dollar.
The euro was little changed at $1.1238 and the yen was at 120.29 per dollar.
Britain’s pound fell for an eighth day against the dollar, its longest stretch of declines in almost a year, as a report showed growth in U.K. services unexpectedly slowed in August. Australia’s dollar weakened toward a six-year low after retail sales unexpectedly fell.
(For more news on currencies, see TOP FX.)

Bonds

Spain’s 10-year bonds fell as the nation auctioned almost 6 billion euros of debt. The yield on the 2025 securities increased four basis points to 2.16 percent. Germany’s 10-year bund yield was little changed at 0.78 percent before the ECB’s interest-rate decision.
Ten-year Treasury note yields were also little changed, at 2.18 percent.
Corporate-debt sales continued a pickup following August’s seasonal slowdown. Wells Fargo & Co., Heineken NV and Honda Motor Co.’s U.S. finance arm were among companies marketing bonds in euros, according to people familiar with the sales, who asked not to be identified as they aren’t authorized to to speak publicly.
(For more news on bonds, see TOP BON.)

Commodities

The Bloomberg Commodity Index rose 0.2 percent, advancing for a second day. Copper climbed 2.1 percent, while zinc added 1.1 percent. Nickel and aluminum also gained at least 1 percent.
West Texas Intermediate crude added 0.3 percent to $46.39 a barrel in New York, after falling as much as 1.3 percent. Brent oil was little changed at $50.47 in London.
Gold for immediate delivery fell 0.1 percent to $1,133.02 an ounce. The metal lost 0.6 percent on Wednesday, the first decrease in four days.
(For more news on commodities, see TOP CMD.)