The MSCI World Index climbed 0.7 percent at 10:25 a.m. in London. The euro appreciated 0.8 percent against the dollar, while the German 10-year bund yield gained six basis points. The cost of insuring against junk bond defaults in Europe decreased for a sixth day. Futures on the Nasdaq-100 Index lost 0.5 percent. Standard & Poor’s Index futures increased 0.2 percent. Cotton added as much as 2.8 percent and rice jumped 2.6 percent.
Euro-area finance ministers vowed to strengthen the safety net for debt-strapped countries yesterday, examining ways to give the 750 billion-euro ($1 trillion) rescue fund more flexibility without ruling out boosting its size. Apple’s Chief Executive Officer Steve Jobs took a leave of absence to focus on his health, putting the company in the hands of Tim Cook for the third time in seven years, the company said yesterday.
“The euro’s strength is based partly on the perception of a reduction in risk,” said Steve Barrow, head of research for Group of 10 currencies at Standard Bank Plc in London.
The Stoxx Europe 600 Index climbed 1 percent to the highest intraday level since Sept. 3, 2008. Banco Santander SA, Spain’s biggest lender, increased 3.7 percent. SABMiller Plc rose 2.2 percent as the world’s second-biggest brewer by volume reported sales of lager that beat analysts’ estimates.
Apple, Citigroup
The decline in Nasdaq-100 futures indicated the measure will retreat from its Jan. 14 close, which was the highest since February 2001. U.S. markets were shut yesterday for a holiday.
Apple, the world’s second-largest company, slid 5.4 percent in pre-market New York trading. The maker of the iPad is due to release earnings today, along with International Business Machines Corp., Citigroup Inc. and Charles Schwab Corp. Economic reports today may show manufacturing in the New York region expanded in January for a second month and confidence among U.S. homebuilders rose, according to Bloomberg surveys of economists.
The euro appreciated against 13 of its 16 most-traded counterparts, advancing 0.6 percent versus the yen. The pound jumped 0.9 percent, trading above $1.60 for the first time since Nov. 22, after U.K. inflation accelerated in December by more than economists forecast. The Dollar Index, which tracks the U.S. currency against those of six trading partners, dropped 0.7 percent to the lowest level since November. Australia’s dollar strengthened through parity with the U.S. currency for the first time since Jan. 13, advancing 0.6 percent.
Ireland Vote
Irish 10-year bonds tumbled, driving the yield up 17 basis points to 8.74 percent, as Prime Minister Brian Cowen faces a vote of confidence today by his Fianna Fail party. Yields on equivalent-maturity Spanish debt rose three basis points to 5.49 percent even as borrowing costs fell at a sale of 5.5 billion euros of bills.
Belgium auctions 3 billion euros ($4 billion) of 84- and 364-day bills today. The government is also selling 10-year bonds through banks, which may be priced to yield 90 to 93 basis points more than the benchmark mid-swap rate, according to a banker involved in the transaction. The yield on the 3.75 percent security due September 2020 jumped six basis points to 4.21 percent. Greece sold 650 million euros of 13-week notes.
The Markit iTraxx Crossover Index of credit-default swaps on 50 speculative-grade, or junk-rated, European companies fell 5 basis points to 407, the lowest level since April, according to JPMorgan Chase & Co.
China Cotton
Cotton for delivery in March rose after the China Cotton Association said yesterday that the country’s December imports more than doubled. Rough-rice futures for March delivery gained 37 cents in Chicago. Copper for delivery in three months advanced 0.8 percent on the London Metal Exchange.
The MSCI Emerging Markets Index added 0.5 percent as benchmark indexes in Poland, Hungary, the Czech Republic and South Africa rallied more than 1 percent. India’s Sensex index advanced 1.1 percent after Tata Consultancy Services Ltd., the country’s biggest software services company, posted record profit. Samsung Electronics Co., Hynix Semiconductor Inc. and Powerchip Technology Corp. gained at least 2 percent after Nikkei newspaper reported Elpida Memory Inc., the world’s third- largest maker of computer memory chips, will raise prices.
--With assistance from Abigail Moses, Andrew Rummer, Daniel Tilles and Jason Webb in London. Editors: Stephen Kirkland, Justin Carrigan
