Europe Index Futures Rise With Asia Stocks as Kiwi Drops
European stock index futures rose as Asian stocks headed for their highest close this year after China’s premier said policy will be fine-tuned as needed to support the economy. New Zealand’s dollar fell with crude futures as copper and platinum gained.
European Stoxx 50 index futures were up 0.4 percent at 7:09 a.m. in London while the MSCI Asia Pacific Index added 0.4 percent, climbing a third day. Indian stocks rose to a record and Standard & Poor’s 500 Index futures were 0.1 percent higher. New Zealand’s currency lost 0.2 percent while Taiwan’s dollar gained 0.3 percent. Brent oil slid 0.7 percent as platinum rose 0.4 percent and copper jumped 0.8 percent to the highest price since March 7. Japanese corporate bond risk dropped to the least since March 19.
China’s Premier Li Keqiang said the government will adjust policy to help the real economy, according to a statement on the government’s website May 23. Narendra Modi will be sworn in as India’s prime minister, as exit polls show billionaire Petro Poroshenko will be Ukraine’s new president. Markets in the U.S. and U.K. are closed for holidays, after an increase in American home sales helped the S&P 500 to a record.
“The broad trend in shares is expected to remain up,” Shane Oliver, who oversees about $133 billion as head of investment strategy at AMP Capital Investors Ltd. in Sydney, said by e-mail. “Share-market fundamentals remain favorable with reasonable valuations, global earnings are improving on the back of rising economic growth and monetary conditions are set to remain easy for some time.”
Asian Stocks
The S&P BSE Sensex rose 1.5 percent to a record in Mumbai, the best performer in Asia today. The MSCI Asia Pacific gauge traded at 12.9 times estimated earnings after two straight weeks of gains. That compares with valuations of 16.1 for the S&P 500 and 15.3 for the Stoxx Europe 600 Index, data compiled by Bloomberg show.
Japan’s Nikkei 225 Stock Average climbed 1 percent as the yen traded at 101.94 per dollar after reaching a one-week low. Bank of Japan policy makers said the economy will probably grow above potential from summer, according to the minutes released today from an April 30 meeting. The Markit iTraxx Japan index of credit-default swaps declined 0.5 basis points to 81.5 basis points, Citigroup Inc. prices showed.
Australia’s S&P/ASX 200 Index (AS51) added 0.4 percent while South Korea’s Kospi gauge dropped 0.3 percent. The Shanghai Composite Index increased 0.2 percent.
Honda Motor Co., a Japanese carmaker that gets 83 percent of sales abroad, climbed 1.8 percent in Tokyo. Mitsubishi UFJ Financial Group Inc. led Japanese banks higher, rising 1.6 percent. Naver Corp. sank 4 percent in Seoul after two of its competitors, Kakao Corp. and Daum Communications Corp, said they will merge.
Kiwi Drops
China’s benchmark money-market rate dropped the most in three weeks after Li signaled more policy easing to counter a slowdown in the world’s second-largest economy. The seven-day repurchase rate fell 20 basis points to 3.22, according to a daily fixing by the National Interbank Funding Center.
“Premier Li’s comments, which have been consistent with previous comments that the central government will take actions to stabilize growth, assured the market that there won’t be a rate spike in June,” said Chen Peng, an analyst at Fortune Securities Co. In Shenzhen.
New Zealand’s dollar, known as the kiwi, fell to 85.38 U.S. cents. Trade data showed exports to China from the South Pacific nation were the lowest since September, even as shipments to its largest trading partner rose 38 percent in April from a year earlier. The Taiwanese dollar climbed to 30.093 a dollar after better-than-estimated economic data May 23.
S&P Record
The S&P 500 ended the May 23 session at 1,900.53, closing above 1,900 for the first time. While trading volumes May 23 were near the lowest level for the year, the Nasdaq Composite Index (CCMP) jumped 0.8 percent to erase its annual loss.
Platinum climbed to $1,478.25 an ounce following a 0.5 percent advance last week. Gold, regarded as a haven investment along with the yen, was little changed at $1,292.57 an ounce after slipping 0.1 percent in the five days to May 23. The London Metal Exchange is closed today.
Copper in Shanghai rose for a third day as stockpiles tracked by exchanges in London, Shanghai and New York slumped. The contract for delivery in August on the Shanghai Futures Exchange rose 0.6 percent to 49,000 yuan ($7,857) a metric ton. Futures advanced 1 percent last week.
Brent crude fell to $109.80 a barrel. Brent reached $110.55 on May 21, the highest close since March 3, as deadly fighting in Ukraine stoked speculation supplies from Russia, the world’s biggest energy exporter, may be impacted. West Texas Intermediate crude oil dropped 0.4 percent to $103.93 a barrel in electronic trading today, after climbing 2.7 percent last week in a third week of gains.
Poroshenko gained more than 50 percent of the vote in the Ukrainian election, according to two exit polls, with former prime minister Yulia Tymoshenko second among 21 presidential candidates. Most of the former Soviet republic’s easternmost regions didn’t vote, with a pro-Russia insurgency taking hold there.
Source: bloomberg
