BLBG: Yen Drops as German Business Confidence Increases
cast of 33 economists surveyed by Bloomberg. Oracle Corp., the world’s second-biggest software maker, reported profit that beat estimates while Research In Motion Ltd. forecast higher sales. Analysts project U.S. earnings will climb 52 percent through 2011, data compiled by Bloomberg show.
“The IFO data are an additional support for European markets,” said Markus Steinbeis, head of equity portfolio management at the German unit of Pioneer Investments, which oversees about $221 billion globally. “Companies are optimistic, at least for the first quarter of 2010.”
The MSCI World Index of 23 developed nations’ stocks rose 0.2 percent. Aggreko Plc jumped 3.6 percent in London after saying revenue in the fourth quarter was better than anticipated.
Iliad, Credit Agricole
Iliad SA climbed 3.2 percent in Paris after Morgan Stanley upgraded France’s third-largest provider of broadband services to “overweight.” Gains were limited as Credit Agricole SA, France’s largest bank by branches, sank 5.3 percent after Bank of America Merrill Lynch Global Research cut its recommendation on the stock to “neutral.”
The gain in U.S. futures indicated the S&P 500 may pare some of yesterday’s 1.2 percent drop. Oracle rose as much as 3.5 percent in German trading and Research in Motion, maker of the BlackBerry, surged 12 percent.
The MSCI Asia Pacific Index retreated 0.5 percent. Woori Finance Holdings Co. declined 3.9 percent in Seoul after the Basel Committee on Banking Supervision said lenders should increase the quality of the capital they hold by 2012. Industrial & Commercial Bank of China Ltd. slid 1.7 percent in Hong Kong after Fitch Ratings said Chinese banks’ capital strength is probably “strained.” The Shanghai Composite Index fell 2.1 percent, the steepest decline among equity gauges.
Emerging Markets
The MSCI Emerging Markets Index fell for a fourth day, losing 0.2 percent. Developing-nation equity fund inflows slowed in the week to Dec. 16, with 2010 poised to be a more “testing year” amid waning stimulus measures worldwide, according to Cambridge, Massachusetts-based EPFR Global. Investors added $571.4 million to the more than $75 billion attracted by developing-nation equity funds this year, a record high.
The yen weakened against all 16 most-traded currencies, falling 0.6 percent to 129.79 per euro and 0.3 percent to 90.23 against the dollar.
The Swiss franc climbed as much 0.7 percent to 1.4909 against the euro, surpassing 1.50 for the first time since March and igniting concern that the central bank may sell the currency. Nicolas Haymoz, a Swiss National Bank spokesman in Zurich, declined to comment on the franc’s move.
The SNB’s failure to act yesterday “gave the idea to the market that maybe the SNB doesn’t care anymore,” said Lutz Karpowitz, a currency strategist in Frankfurt at Commerzbank AG, Germany’s second-biggest lender. “It would be a risky game to bet on more franc strength.”
Treasuries Decline
Treasuries fell, sending the yield on the 10-year note up 2 basis points to 3.50 percent and the two-year yield 4 basis points higher to 0.80 percent.
Bill Gross, who runs the world’s biggest bond fund, cut government debt holdings and boosted cash to the most since Lehman Brothers Holdings Inc. collapsed in 2008 amid increasing speculation that interest rates will rise. Gross, who manages the $199.4 billion Total Return Fund at Pacific Investment Management Co., increased cash to 7 percent in November from negative 7 percent in October, according to Pimco’s Web site.
Crude oil rose 0.8 percent to $73.22 a barrel in New York trading. Copper for delivery in three months gained 0.6 percent to $6,910 a metric ton on the London Metal Exchange, leading an advance in industrial metals. Gold for immediate delivery added 0.8 percent to $1,107.50 an ounce.
To contact the reporter on this story: Stuart Wallace in London at swallace6@bloomberg.net
