By Daniel Hauck Aug. 13 (Bloomberg) -- Stocks and commodities rose for a second day and bonds fell as the German and French economies unexpectedly grew in the second quarter and the Federal Reserve indicated the worst slump since the Great Depression is easing. The MSCI World Index of 23 developed nations gained 0.5 percent at 10:00 a.m. in London and futures on the Standard & Poor’s 500 Index climbed 0.9 percent. Oil rose for a second day in New York, copper reached a level not seen since October on the London Metal Exchange and nickel advanced to the highest price in almost a year. Treasuries declined for a second day as the U.S. prepared to sell a record $15 billion of 30-year bonds. European stocks climbed as government data showed gross domestic product rose a seasonally adjusted 0.3 percent from the first quarter in Germany and France, pulling the euro region’s two largest economies out of their worst contractions since World War II. Shares in Asia climbed after Fed policy makers signaled they aren’t rushing to end unprecedented efforts to promote lending and stabilize the world’s biggest economy. “Overall the sentiment is positive with the Fed comment,” said Christoph Eibl, co-founder of Zug, Switzerland-based Tiberius Asset Management, which oversees $1.5 billion. “People are using every positive argument to get back into the markets. Definitely this is driven by some noise, but I believe things are getting better than many people think.” Prudential, Rio Tinto The Dow Jones Stoxx 600 Index of European shares climbed 0.9 percent as raw-material producers advanced with metals and Prudential Plc posted earnings that beat analysts’ estimates. The 46 percent rally in the Stoxx 600 since March 9 has driven price-earnings valuations to the highest level since September 2003, weekly data compiled by Bloomberg show. Rio Tinto Group, the world’s third-largest metals producer, advanced 3.3 percent in London. Prudential, the U.K.’s biggest insurer by market value, climbed 6 percent after saying its first-half loss narrowed as U.S. sales rose and the value of securities increased. The rise in U.S. futures indicated that the S&P 500 may extend a five-month, 49 percent surge that has been led by financial shares. John Paulson, the hedge-fund manager whose wagers against the U.S. housing market helped him earn an estimated $2.5 billion last year, bought Bank of America Corp. and Goldman Sachs Group Inc. stock in the second quarter, according to a filing yesterday with the U.S. Securities and Exchange Commission. The MSCI Emerging Markets Index added 1.4 percent, the biggest increase since Aug. 3. The Dubai Financial Market General Index added 1.9 percent as oil climbed. Micex Climbs The Micex Index of stocks in Russia, the world’s biggest energy-exporting economy, jumped 1.8 percent. The ruble strengthened as much as 1.4 percent versus the dollar to 32.0291, snapping the longest slump in seven months. Crude oil for September delivery rose 1.1 percent to $70.91 a barrel on the New York Mercantile Exchange. Copper rose 2.5 percent to $6,345 a metric ton and nickel added 5.6 percent to $20,754 a ton on the LME. Gold for immediate delivery advanced 0.6 percent to $952.63 an ounce. Corn led an advance in grains in Chicago, rising 0.9 percent to $3.3925 a bushel. The euro strengthened for a third day against the dollar, and for a second day versus the yen, after the European Union’s statistics office said the region’s economy contracted 0.1 percent in the second quarter, less than economists forecast, because of the unexpected strength in Germany and France. The euro gained to $1.4244, and to 137.26 yen. The dollar fell against 14 of the 16 major currencies after the Fed statement, while South Korea’s won led Asian currencies higher. Treasuries Fall Treasuries fell after the Fed said it will “gradually slow” its purchases of securities as it aims to purchase as much as $300 billion of bonds by the end of October, ending the program a month later than initially suggested. The yield on the 10-year note rose 2 basis points to 3.73 percent. The Treasury is scheduled to sell a record $15 billion of 30-year bonds today. “The Treasury market is going to miss the Fed coming in and buying $50 billion a month,” Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ in New York, wrote in a report on the U.S. central bank’s meeting. “Although the Fed did not say the recession had ended today, their actions suggest that they believe we are headed out of recession.” The yield on the 10-year German government bond rose 2 basis points to 3.47 percent, while the 10-year French note yield climbed 2 basis points to 3.68 percent. Credit-default swaps on the Markit iTraxx Crossover Index of 44 companies with mostly high-yield credit ratings dropped 29.5 basis points to 585.5, according to JPMorgan Chase & Co. prices. The decline signals an improvement in perceptions of credit quality. To contact the reporters on this story: Daniel Hauck in London at dhauck1@bloomberg.net.

Source