Oct. 8 (Bloomberg) -- Copper and oil gained while stocks rose for a fourth day as better-than-estimated earnings from Alcoa Inc. signaled the economic recovery is boosting raw- material demand. Gold set a third record as the dollar fell. Copper reached a two-week high and crude oil added as much as 1.5 percent. Gold advanced for a fifth day as the Dollar Index, a gauge of the greenback’s performance against six major currencies, retreated 0.7 percent. The MSCI World Index of equities in 23 developed countries rose 0.8 percent at 10:40 a.m. in London and futures on the Standard & Poor’s 500 Index increased 1 percent. Russian stocks and bonds led gains in emerging markets. Alcoa, the largest U.S. aluminum producer, reported an unexpected profit for the third quarter and Chief Executive Officer Klaus Kleinfeld predicted demand will improve in the second half. Central bankers around the world have driven borrowing costs to record lows to revive growth, including coordinated cuts in six regions a year ago. “We do clearly see growth, substantial growth I might add, in China, a stabilization in North America,” Kleinfeld said on a conference call late yesterday. The “second half of the year is clearly better than the first half in many industries and also in many regions.” Copper for delivery in three months rose 3 percent to $6,280 a metric ton on the London Metal Exchange. Aluminum added 2.3 to $1,886 a ton. Nickel, zinc and tin also advanced. Crude oil for November delivery gained 0.9 percent to $70.19 a barrel in New York trading. Gold for immediate delivery rallied as much as 1.4 percent to a record $1,058.48 an ounce. S&P 500 The rise in U.S. futures indicated the S&P 500 will climb for a fourth straight day, as Alcoa added 7.2 percent in Germany. The New York-based company’s profit excluding certain items was 4 cents a share, exceeding the average analyst estimate for a 9- cent loss. Raw-material producers led the 1 percent gain in the Dow Jones Stoxx 600 Index of European shares. Xstrata Plc, the world’s fourth-biggest copper producer, advanced 3.4 percent in London and Antofagasta Plc, the copper producer controlled by Chile’s Luksic family, rose 2.8 percent. Lloyds Banking Group Plc slid 3.9 percent. The U.K.’s largest mortgage lender said it will keep its options open after the Financial Times reported that Lloyds is preparing to raise 15 billion pounds ($24 billion) in a share sale and leave the government’s asset-insurance program. Russia, Turkey The MSCI Emerging Markets Index rose 0.9 percent to a 13- month high as Russia’s Micex Index jumped 2.3 percent and indexes in Turkey, Dubai and Poland added more than 1 percent. Developing-nation bonds rallied, lowering the extra yield investors demand to own the debt instead of U.S. Treasuries by six basis points to 3.15 percentage points, led by a 15 basis- point narrowing in Russia’s spread, according to JPMorgan Chase & Co.’s EMBI+ Index. The dollar fell against all but one of the 16 most-traded currencies tracked by Bloomberg, losing 0.5 percent versus the euro and 0.4 percent against the yen. The Dollar Index, which IntercontinentalExchange Inc. uses to track the currency against those of six U.S. trading partners, fell to within half a point of its lowest level since Aug. 11 last year. Australia’s dollar led gains among the currencies of commodity-producing countries, climbing to a 14-month high against its U.S. counterpart, after a report showed employment unexpectedly increased. The New Zealand dollar advanced to its strongest level since July 2008. ECB, BOE Australia raised its benchmark interest rate two days ago, the first Group of 20 nation to do so since the start of the global financial crisis. The European Central Bank and the Bank of England, which decide on interest rates today, may signal there is no need to expand bond-buying programs amid evidence the economic rebound is gaining traction. The International Monetary Fund on Oct. 1 raised its forecast for global growth next year as more than $2 trillion in stimulus packages and demand in Asia pull the world economy out of its worst recession since World War II. The Washington-based IMF said the economy will expand 3.1 percent in 2010, more than a July forecast of 2.5 percent. The cost of protecting corporate bonds in the credit- default swaps market fell, with Europe’s high-yield Markit iTraxx Crossover Index dropping 23 basis points to 550, the lowest level since the current series of the gauge started trading Sept. 21, according to JPMorgan Chase & Co. A decline in the value of credit-default swaps signals an improvement in investors’ perception of credit quality. To contact the reporter on this story: Stuart Wallace in London at swallace6@bloomberg.net

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