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Stocks Rise on Earnings; U.S. Futures Advance, Sugar Rallies
2010-08-06 11:33:52.694 GMT
By Stephen Kirkland
Aug. 6 (Bloomberg) -- Stocks rose to a three-month high in
Europe after bank earnings topped estimates, and U.S. index
futures advanced before the American employment report. Sugar
jumped as Russia's drought persisted.
The Stoxx Europe 600 Index increased 0.4 percent at 7:30
a.m. in New York as three stocks gained for every two that fell.
Futures on the Standard & Poor's 500 Index added 0.2 percent.
The Dollar Index rose 0.1 percent, trimming its ninth weekly
drop. Raw sugar rallied for the second time in three days.
U.S. non-farm payrolls probably fell by 65,000 in July,
according to the median estimate of 84 economists surveyed by
Bloomberg News. European Central Bank President Jean-Claude
Trichet said yesterday that Europe is recovering faster than
forecast. About 52 percent of Stoxx 600 members that posted
results since July 12 have beaten analysts' estimates for net
income, according to data compiled by Bloomberg.
"With these profits come investment and that's what we are
starting to get," Mike Lenhoff, chief strategist at London-
based Brewin Dolphin Securities Ltd., which oversees $33
billion, said in a Bloomberg Television interview.
"Investment is starting to pick up and with investment will
sooner or later come the jobs. We have to give it a chance, and
a bit of time. There is a lot of value in the markets."
RBS, Umicore
The Stoxx 600 headed for its highest close since April 26.
Royal Bank of Scotland Group Plc rallied 2 percent after posting
a profit for the first time since 2007. Umicore SA, the world's
largest precious-metals recycler, jumped 3.5 percent after
raising its earnings forecast. Allianz SE, Europe's biggest
insurer, gained 1 percent as operating profit beat estimates.
Old Mutual Plc climbed 3 percent after returning to profit in
the first half and agreeing to sell its U.S. life operations for
$350 million.
The MSCI Asia Pacific Index added 0.3 percent, capping its
fifth weekly advance. Cheung Kong (Holdings) Ltd., Hong Kong's
second-biggest developer by value, and its Hutchison Whampoa
Ltd. affiliate jumped more than 3 percent on better-than-
estimated profit. NTT DoCoMo Inc., Japan's largest mobile-phone
operator, climbed 2.9 percent.
The gain in U.S. futures indicated the S&P 500 will erase
yesterday's 0.1 percent drop. Today's report from the Labor
Department, due at 8:30 a.m. in Washington, may show private
payrolls that exclude government agencies rose by 90,000 workers
after growing by 83,000 in June, according to the median
estimate of 54 economists surveyed by Bloomberg News. The data
may also indicate the jobless rate increased to 9.6 percent last
month from 9.5 percent in June, according to the survey median.
AIG Earnings
American International Group Inc. said second-quarter
adjusted earnings were $1.99 a share. The average of two
estimates in a Bloomberg survey was 99 cents. Berkshire Hathaway
Inc. is also among companies scheduled to release results today.
Of the more than 400 companies in the S&P 500 that have reported
earnings since July 12, about 78 percent have beaten estimates
for per-share profit, according to data compiled by Bloomberg.
Raw sugar for October delivery climbed 0.6 percent on ICE
Futures U.S. in New York after Russia's national weather service
said sugar beet is among crops being damaged by drought. Nickel
increased 1.1 percent as industrial metals advanced on the
London Metal Exchange.
China led gains in major emerging markets. The Shanghai
Composite Index rose 1.4 percent as agricultural companies
advanced after floods boosted food prices. The MSCI Emerging
Market Index of 21 developing nations climbed 0.2 percent to its
highest level since April 30.
Dollar Weakens
The Dollar Index, which tracks the U.S. currency against
those of six trading partners, has dropped 0.7 percent this
week, heading for its longest run of weekly declines since 2004.
The yen weakened against all but three of its 16 most-traded
counterparts, depreciating 0.3 percent against both the dollar
and the euro.
The yield on the two-year Treasury note held at 0.545
percent, within four basis points of a record low. The 10-year
yield was little changed at 2.91 percent.
The cost of insuring European corporate bonds fell, with
the Markit iTraxx Crossover Index of credit-default swaps on 50
mostly junk-rated companies dropping 8.1 basis points to 463.4,
according to Markit Group Ltd.
For Related News and Information:
Developed Markets View: DMMV <GO>
Emerging Markets View: EMMV <GO>
Stock Market Map: IMAP <GO>
World Equity Markets: WEI <GO>
World Bond Markets: WB <GO>
World Currency Ranker: WCRS <GO>
Commodity Ranked Returns: CRR <GO>
CDS Sector Graph: GCDS <GO>
--With assistance from Mark Barton, Claudia Carpenter, Adam
Haigh, David Merritt, Abigail Moses, Daniel Tilles and Jason
Webb in London. Editors: Stephen Kirkland, Justin Carrigan.
To contact the reporter on this story:
Stephen Kirkland in London at +44-20-7073-3172 or
skirkland@bloomberg.net
To contact the editor responsible for this story:
Paul Sillitoe in London at +4420-7073-3857 or
psillitoe@bloomberg.net
