Stocks rose, with the Dow Jones Industrial Average reaching a third straight record, as US jobless claims dropped. The euro gained as the European Central Bank said the economy may stabilize this year while Japan's yen weakened to 95 per dollar for the first time since 2009.
The Dow rose 0.3 per cent to 14,338.86 and the Standard & Poor's 500 Index gained 0.2 per cent at 12:58 p.m. in New York. Brazil's Bovespa extended its two-day rally to 5.9 per cent, the most since July. The euro climbed 1 per cent to $US1.3099, rebounding from its 2013 low, while the yen weakened against all 16 major peers. Spain's 10-year bond yield fell 11 basis points to 4.89 per cent as the nation sold debt. Natural gas jumped more than 3 per cent to lead gains in commodities.
The S&P 500 climbed to within 1.4 per cent of its 2007 record as jobless claims unexpectedly fell by 7,000 to 340,000 last week, bolstering optimism before tomorrow's monthly employment report. The ECB kept its benchmark interest rate at a record low today and President Mario Draghi said data suggests the economy will stabilize in the first half of this year.
"This is now two straight days we've had a positive reading on the labor market and one of the big concerns in the market has been whether this is jobless prosperity and ergo can it continue?" Uri Landesman, president of New York-based hedge fund Platinum Partners, which manages about $US1.2 billion, said by telephone. "I'm still skeptical but the data the last two days would support the fact that it's not jobless prosperity," he said. "The data's been strong and if the bulls are still in control of the market, that should take us through resistance."
Dow Record
The Dow rose 0.3 per cent yesterday to extend an all-time high as a private report showed faster-than-forecast growth in jobs and the Federal Reserve's Beige Book said the economy was growing. Data tomorrow may show US employers added 163,000 people to payrolls in February and the unemployment rate held at 7.9 per cent, according to the median economist forecast.
Bank of America Corp. and JPMorgan Chase & Co. jumped at least 1 per cent to pace gains in financial shares and the Dow. Boeing Co. jumped 2.5 per cent after winning orders for 27 jets in the past week.
Trading volume for S&P 500 stocks was about 12 per cent below the 30-day average for this time of day. Ciena Corp. jumped 16 per cent and JDS Uniphase Corp. surged 7 per cent as Ciena posted quarterly earnings that topped estimates. Time Warner Inc. climbed 1.8 per cent after saying it will spin off its magazine business. PetSmart Inc. tumbled 7 per cent as forecasts for earnings and sales growth missed projections.
The US Dollar Index, a gauge of the currency against six major peers, slipped 0.4 per cent to 82.12 today after reaching its strongest level in more than six months yesterday.
Dollar Correlation
For the first time in four years the dollar is participating in a rally that has sent stocks higher as traders in the $US4-trillion-a-day foreign-exchange market bet the world's largest economy will only strengthen. That's unusual because the greenback has tended to move in the opposite direction to equities in recent years as investors sought a haven from the global financial crisis, sovereign bailouts in Europe and slower growth.
"This is potentially a clear turning point for the US dollar," said John Horner, a currency strategist in Sydney at Deutsche Bank AG, the world's top foreign-exchange trading firm as measured by Greenwich Associates. "We're now starting to get toward the point where good US data is good for the US dollar and good for US markets, and that's a quite different scenario to what we've seen over the past few years."
Concern about Europe's debt crisis eased as the Spanish Treasury met its maximum target at a debt auction in Madrid today. Demand for the 2018 note was 2.32 times the amount sold, up from 2.24 last month. The 10-year benchmark yield was 4.917 per cent, down from 5.202 per cent on Feb. 21, the Bank of Spain said. That's the lowest yield since November 2010.
European Bonds
The advance in Spanish bonds pushed the 10-year yield to the lowest since January. Portugal's 10-year yield fell 22 basis points to 5.93 per cent, also the least since January, after the nation's credit rating outlook was raised to stable from negative by S&P, which said European lenders will probably extend support to the government and make the nation's fiscal tightening "more sustainable."
U.K. 10-year bond yields rose six basis points to 2.01 per cent. The Monetary Policy Committee led by Governor Mervyn King maintained its target for quantitative easing at 375 billion pounds ($US565 billion). The decision was forecast by 29 of 39 economists in a Bloomberg News survey, with the remainder having predicted an expansion of at least 25 billion pounds.
'Remain Accommodative'
The euro's advance lifted it from yesterday's low of $US1.2965, the weakest level since Dec. 11. The 17-nation currency appreciated 1.9 per cent to 124.31 yen and climbed 1 per cent to 87.22 British pence. ECB President Mario Draghi stuck to his view that the euro region will gradually recover and said the bank's monetary policy "will remain accommodative for as long as needed."
The cost of insuring against losses on French government debt climbed after a report showed the nation's unemployment rate rose to a 13-year high in the fourth quarter. Credit- default swaps on the country's sovereign debt increased 3 basis points to 79.
Aggreko Rally
Aggreko Plc jumped 10 per cent in London, the most since 2008 on a closing basis, after the world's largest provider of mobile power supplies reported higher annual profit and forecast "double digit" average revenue growth over the next five years. Adidas AG climbed 6.6 per cent as the second-largest sporting-goods maker forecast an increase in earnings.
Aviva Plc, the U.K.'s second-biggest insurer, plunged 13 per cent, the most in almost four years, after cutting its second-half dividend by 44 per cent. National Express Group Plc slid 11 per cent as the rail and bus operator's biggest investor, Elliott Advisors, sold a 9.9 per cent stake.
Sugar, natural gas, lean hogs and aluminum jumped at least 2.4 per cent to lead gains in 18 of 24 commodities tracked by the S&P GSCI Index. Natural gas surged more than 3 per cent to a six- week high after government data showed US inventories fell by more than forecast last week as cold weather boosted demand.
The MSCI Asia Pacific Index of shares fell 0.3 per cent, retreating from 19-month high reached yesterday, as Chinese and South Korean stocks slumped. The yen weakened after Bank of Japan's Masaaki Shirakawa's final meeting amid speculation his successor will expand monetary stimulus and debase the currency.
China Watch
China's exports probably grew 8.1 per cent last month, slowing from January's 25 per cent gain, according to the median estimate of economists surveyed before tomorrow's trade report. The Shanghai Composite Index slid 1 per cent and South Korea's KOSPI lost 0.8 per cent, declining for the first time in three days.
The MSCI Emerging Markets Index slipped 0.1 per cent. Bovespa index advanced to a one-month high as companies owned by the Brazilian billionaire Eike Batista rallied after he signed a financing arrangement with Grupo BTG Pactual. Shares on the Nairobi Securities Exchange jumped 0.9 per cent, climbing for a sixth day. The counting of presidential votes continues in Kenya, with partial results showing Uhuru Kenyatta, a deputy prime minister, in the lead.
The UN Security Council voted unanimously to impose tougher sanctions on North Korea for conducting a nuclear test explosion in violation of its previous prohibition.
No comments:
Post a Comment