Stock Futures Rise as Dollar Holds Yen Gain Before Data
U.S. and European equity-index futures climbed and the dollar held gains against the yen and euro before a payrolls report. Stocks fluctuated in Asia, wheat slid toward its first loss in five weeks and India’s rupee fell.
Contracts on the Standard & Poor’s 500 Index added 0.1 percent by 7:10 a.m. in London after the gauge slipped from a record. Futures on the Euro Stoxx 50 Index advanced 0.3 percent. The greenback was little changed at 103.91 yen, close to a 10-week high and stronger for a third straight week. The euro slipped 0.2 percent to $1.3698. The MSCI Asia Pacific Index was little changed and set for its biggest fortnight’s gain since Sept. 20. Wheat dropped 0.5 percent and aluminum added 0.5 percent. The rupee retreated 0.3 percent.
With the Federal Reserve tying the timeline for reductions in bond buying to the state of the U.S. jobs market, investors are zeroing in today’s nonfarm payrolls report, projected to show the biggest increase in workers since November. German factory orders climbed 0.6 percent in February, the Deutsche Bundesbank said today, while economists had estimated a 0.2 percent gain. The European Central Bank signaled yesterday it may use quantitative easing to ward off deflation.
“People are waiting ahead of payrolls,” George Boubouras, who helps oversee a portfolio of global stocks worth $30 billion as chief investment officer at Equity trustees Ltd. in Melbourne, said by phone. “It’s been a constructive week for equities. It’s not correct to assume rates are rising anytime soon and the backdrop for developed-market equities, even at all-time highs, is still for an expansion in earnings.”
U.S. employers probably added 200,000 people to nonfarm payrolls last month, according to the median of 90 economists’ estimates compiled by Bloomberg, the most since a 274,000 increase in November and up from the 175,000 workers added in February.
Claims Rise
Data yesterday showed an increase in jobless claims, with the number of people claiming unemployment benefits in the U.S. rising to a five-week high of 326,000, exceeding the median forecast for 319,000 claims.
The Institute for Supply Management’s non-manufacturing index for the U.S. rose to 53.1 in March, from a four-year low of 51.6 reached in February, the Tempe, Arizona-based group said yesterday. Readings greater than 50 signal expansion.
“The nonfarm payrolls are gearing up for a big figure,” Evan Lucas, a markets strategist in Melbourne at IG Ltd., wrote in an e-mail to clients. “Considering services are the biggest component of the U.S. economy and also the largest employment sector in the U.S., this really does put the payrolls figure on target for the forecast number.”
Asian Equities
In Europe, futures on the FTSE 100 Index climbed 0.3 percent. The Stoxx Europe 600 Index is less than 2 points away from a six-year closing high struck in February.
Russia’s Micex Index fluctuated in Moscow. The ruble was little changed at 35.5075 against the dollar and gained 0.3 percent to 48.6707 to the euro.
About five stocks retreated for every four that rose on the Asia-Pacific gauge today, which is headed for a 1.7 percent gain this week after adding 2.9 percent in the five days to March 28.
The Hang Seng Index in Hong Kong slid 0.2 percent as a measure of Chinese companies listed in the city advanced 0.2 percent.
Tencent Holdings Ltd. (700), China’s biggest Internet company and the second-heaviest weighted stock in the Hang Seng Index, fell to a two-month low while volatility in the shares rose to the highest level since December 2011 amid growing concern that Internet companies are overvalued. The stock, which more than doubled in the last 12 months, slid as much as 6.3 percent to HK$512, before paring its drop to 4.2 percent.
HKEx Access
Hong Kong Exchanges & Clearing Ltd. (388), operator of the city’s bourse and owner of the London Metal Exchange, jumped 3.4 percent. China Business News reported that a plan for mutual market access with its Shanghai counterpart has been submitted for government approval. The stock is up 11 percent this week, the most since December 2011.
The Shanghai Composite Index climbed 0.5 percent before a three-day weekend for mainland-Chinese markets. The number of transactions on the gauge for China’s biggest market was 27 percent below the 30-day average.
The yuan weakened for a second day in Shanghai after the People’s Bank of China dropped the reference rate for the currency at the weakest since Sept. 18.
Trading volume on Japan’s two leading indexes was at least 24 percent lower than the 30-day average for the time of day. The Topix fell 0.1 percent and the Nikkei 225 Stock Average slipped 0.1 percent.
Yen Loss
The yen weakened 1 percent versus the dollar this week, the most since the period ended March 7. The greenback is up for the week against 13 of 16 major peers, with the New Zealand dollar leading declines.
The Markit iTraxx Asia index of credit-default swaps decreased 1.5 basis points to 124.5 basis points as of 8:30am in Hong Kong, according to Standard Chartered. The benchmark for pricing bond risk is on track for its lowest close since April 2, when it touched a six-month low, and to fall 3.7 basis points this week, according to data provider CMA.
Wheat fell to $6.7275 a bushel today after rising 1 percent yesterday on U.S. drought concerns. The grain is heading for 3.3 percent weekly loss, snapping four weeks of gains.
Aluminum in London rose to $1,845, heading for the highest close since Oct. 31. The metal was set for the biggest weekly advance since the end of November 2012 on concern that global supply will be limited on longer delays to take delivery from warehouse and production cuts.
India’s rupee slid to 60.3225 per dollar and is headed for its biggest weekly loss in more than two months on speculation the central bank will curb currency appreciation to protect exporters. Reserve Bank of India Governor Raghuram Rajan said a rupee level of 55 per dollar would be “too strong,” according to an interview with the Mint newspaper published yesterday.
Source: bloomberg
