By Stephen Kirkland & Jae Hur - Aug 16, 2013 3:51 AM PT
Metals advanced before reports on U.S. housing starts and consumer confidence whileStandard & Poor’s 500 Index (SPX) futures rose, signaling the equity gauge will rebound from the biggest drop in eight weeks. European shares fluctuated and Indian stocks tumbled.
Copper rose 1.1 percent to $7,387 a metric ton at 6:48 a.m. in New York and zinc added 1.6 percent. S&P 500 futures added 0.3 percent while the Stoxx Europe 600 Index slipped 0.1 percent. India’s Sensex index sank the most since 2011 as the rupee dropped to a record, while the Shanghai Composite slid 0.6 percent, reversing an advance of 5.6 percent after a trading error. Treasuries extended a weekly decline.
A pedestrian looks at an electronic stock board outside a securities firm in Tokyo. Photographer: Tomohiro Ohsumi/Bloomberg
Aug. 16 (Bloomberg) -- Norman Chan, head of investment at Calibre Asset Management Ltd., a unit of National Australia Bank Ltd., talks about Federal Reserve monetary policy and the outlook for China stocks. He also discusses the economic outlooks for China, the U.S., and Europe with Rishaad Salamat on Bloomberg Television's "On the Move." (Source: Bloomberg)
Aug. 16 (Bloomberg) -- Wellian Wiranto, an investment strategist at the wealth-management unit of Barclays Plc, talks about global stocks and investment strategy. He speaks with Susan Li on Bloomberg Television's "First Up." (Source: Bloomberg)
Aug. 16 (Bloomberg) -- John Milroy, investment adviser at Macquarie Bank, talks about Australia's financial and mining stocks. He also discusses the outlook for global stocks with Susan Li on Bloomberg Television's "First Up." (Source: Bloomberg)
Aug. 15 (Bloomberg) -- Michael Crofton, president and chief executive officer of Philadelphia Trust Co., talks about the outlook for the U.S. stock market, Federal Reserve monetary policy and the U.S. economy. Crofton speaks with Trish Regan and Adam Johnson on Bloomberg Television’s “Street Smart.” (Source: Bloomberg)
Aug. 16 (Bloomberg) -- Jonathan Cavenagh, a strategist at Westpac Banking Corp. in Singapore, talks about the outlook for global currencies and his investment strategy. He also discusses Federal Reserve monetary policy with Susan Li on Bloomberg Television's "First Up." (Source: Bloomberg)
U.S. housing starts probably increased in July and consumer confidence rose to a six-year high this month, economists said before reports today. The Federal Reserve will reduce its monthly bond purchases next month, according to 65 percent of economists in a Bloomberg survey published this week.
“It does feel like the U.S. economy is gaining a bit of momentum,” said William Hobbs, head of equity strategy at Barclays Plc’s wealth-management unit. “Investors have been trying to decide whether good news is bad news. There must be a lot of institutional money sitting on some very fat profits year-to-date, and a lot of them may feel it is prudent to trim. What might freak the markets out now is the pace of tapering.”
The Stoxx 600 has slipped 0.3 percent this week. Deutsche Lufthansa AG fell 3.6 percent as Morgan Stanley downgraded shares of Europe’s second-largest airline. A.P. Moeller-Maersk A/S rallied 6.6 percent after the owner of the world’s biggest container-shipping line raised its profit forecast.
Housing Starts
The gain in S&P 500 futures indicated the U.S. gauge will trim this week’s 1.8 percent slide. A Commerce Department report at 8:30 a.m. in Washington may show builders began work on an annualized 900,000 homes in July, up from an 836,000 pace in June, according to the median forecast in a Bloomberg survey of 82 economists.
A separate release will probably show a gauge of consumer sentiment in the world’s largest economy rose to a six-year high in August. The Thomson Reuters/University of Michigan preliminary index climbed to 85.2 from 85.1 in July, according to economists’ estimates.
The MSCI Emerging Markets Index fell for a second day, losing 0.2 percent and trimming this week’s advance to 0.7 percent. The Shanghai Composite Index dropped 0.6 percent as Anhui Conch Cement Co., China’s biggest cement maker, fell on worse-than-estimated earnings. The market was roiled by a 53 percent surge in trading volumes that had sent the index to its biggest intraday gain since March 2009.
India Tumbles
India’s Sensex dropped 4 percent, the biggest decline since September 2011, as banking stocks tumbled amid concern the central bank’s measures to bolster the nation’s currency are failing. The rupee slid as much as 0.9 percent to 62.0050 per dollar. The currency has depreciated 4.4 percent in the past three weeks.
West Texas Intermediate oil was little changed, slipping less than 0.1 percent to $107.27 a barrel, after a five-day advance to a two-week high yesterday. Enbridge Inc., Marathon Oil Corp. and BP Plc were among companies removing personnel from facilities in the Gulf region. In Egypt, the Muslim Brotherhood urged supporters onto the streets after noon prayers to protest the killing of hundreds of their number by security forces in a crackdown this week.
Yields Climb
The yield on Egypt’s dollar bond due April 2020 rose for a third day, increasing 19 basis points to a five-week high of 9.21 percent, according to price quotes compiled by Bloomberg. Since the Aug. 14 assault on two squares in Cairo and Giza, where Brotherhood supporters were camped out, the bond price has dropped 4.4 percent, the most in almost 14 months.
Treasury 10-year yields rose less than one basis point to 2.77 percent, poised for their biggest weekly increase in more than a month. The yield touched 2.82 percent yesterday, the highest since Aug. 1, 2011. It has increased 19 basis points this week, the most since the period ended July 5.
The dollar was little changed at 97.41 yen, having risen 1.3 percent this week, the most since the period ended July 19. The Bloomberg U.S. Dollar Index added less than 0.1 percent, bringing this week’s advance to 0.4 percent.
The cost of insuring against losses on corporate debt fell, with the Markit iTraxx Europe Index of credit-default swaps linked to 125 investment grade companies dropping 0.5 basis point to 98.5.
To contact the reporters on this story: Stephen Kirkland in London at skirkland@bloomberg.net; Jae Hur in Tokyo at jhur1@bloomberg.net;
To contact the editor responsible for this story: Justin Carrigan at jcarrigan@bloomberg.net
