By Nicolas Johnson and Matthew Brown Dec. 28 (Bloomberg) -- European stocks rose to a 14-month high and Asian shares advanced after China said its economy grew faster than estimated so far this year. Emerging-market currencies strengthened and U.S. Treasuries fell. The Dow Jones Stoxx 600 Index added 0.4 percent to 252.82 as of 1:59 p.m. in Paris. The MSCI Asia Pacific Index climbed 0.7 percent to 120.38, the highest level since Dec. 14. U.S. futures rose. The Brazilian real advanced against all 16 of the most-traded currencies tracked by Bloomberg. Treasuries dropped before this week’s $118 billion auction of government debt. China’s economy, which is leading the world out of the first global recession since World War II, grew faster than previously estimated, the government said. The U.S. will turn in its best performance since 2004 next year as spending picks up and companies increase investment, said Dean Maki, the most- accurate forecaster in a Bloomberg News survey. “The global economy is just about bottoming out,” said Masaru Hamasaki, chief strategist at Tokyo-based Toyota Asset Management Co., which oversees the equivalent of $14 billion. “I don’t expect huge economic growth, but I do see things recovering.” Germany’s DAX Index climbed 0.7 percent, as did France’s CAC 40. ArcelorMittal, the world’s biggest steelmaker, and Boliden AB led European basic-resources companies higher as metal prices rose. Seadrill Ltd., the drilling company founded by billionaire John Fredriksen, and Aker Solutions ASA gained as crude oil traded above $78 a barrel in New York. Gulf Shares Dubai and Abu Dhabi shares climbed to their highest levels in a week, with the DFM General Index increasing 3.4 percent and the ADX General Index adding 1.2 percent. The Shanghai Composite Index and Nikkei 225 Stock Average led the gains in Asia. Hong Kong’s Hang Seng Index fell 0.2 percent, reversing gains of as much as 1 percent, after property auctions raised less money than the lowest analyst estimates. Standard & Poor’s 500 Index futures, which were closed for trading on Dec. 25, rose 0.1 percent. The Shanghai Composite advanced 1.5 percent to the highest since Dec. 16, led by consumer stocks on the growth outlook and as the government increased price caps for rural purchases of home appliances. GD Midea Holding Co., China’s second-biggest publicly traded appliance maker, climbed to a 19-month high. The Nikkei 225 added 1.3 percent as Japan said industrial production rose for a ninth month in November. JFE Holdings Inc. and Hitachi Construction Machinery Co. led gains. Korean Stocks, Won Doosan Corp., Doosan Heavy Industries & Construction Co., Hyundai Engineering & Construction Co. and Korea Electric Power Corp. surged more than 4 percent after they won a $20 billion United Arab Emirates nuclear-power-plant contract. Korea’s Kospi Index climbed 0.2 percent and the won rose 0.4 percent to 1,170.18, near the strongest in more than a week. East Asian economies will grow faster than initially estimated this year, the World Bank said last month. Developing East Asia, which excludes Japan, Hong Kong, Taiwan, South Korea, Singapore and the Indian subcontinent, will expand 6.7 percent this year, more than an April estimate of 5.3 percent, it said, adding that growth may accelerate to 7.8 percent next year. The U.S. economy will expand 3.5 percent in 2010, according to Maki, the chief U.S. economist at Barclays Capital Inc. in New York. The rebound in stocks and rising incomes will prompt Americans to boost consumption, said Maki, a former economist at the Federal Reserve. Companies will become confident the expansion will be sustained as inventories dwindle and demand increases, he said. Dollar, Real The dollar strengthened for the first time in four days against the yen on speculation U.S. companies are bringing back earnings on overseas assets before the year ends. The U.S. currency rose 0.2 percent to 91.50 yen at 6:44 a.m. in New York, from 91.30 yen on Dec. 25. The dollar was at $1.4402 per euro, compared with $1.4411. The Brazilian real gained most versus the yen, adding 1.4 percent to 52.5369 yen, and advanced 1.2 percent to 1.7416 per U.S. dollar. The Japanese currency fell against all of its 16 major counterparts. Treasuries declined, pushing 10-year yields to a four-month high of 3.84 percent, as investors bet the U.S. recovery will fuel inflation and reduce demand for debt at auctions this week. The gap between yields on 2-year and 10-year Treasuries reached 285 basis points, or 2.85 percentage points, near the highest on record. The government will sell $44 billion of two-year notes today in the first of three auctions this week. Metal Prices Yields on 10-year notes will climb about 40 percent to 5.5 percent in 2010 as investors demand higher returns to fund the record fiscal deficit, according to Morgan Stanley. This will push interest rates on 30-year fixed mortgages to as much as 8 percent, almost the highest in a decade, said David Greenlaw, chief fixed-income economist at Morgan Stanley in New York. Copper for March delivery added as much as 1.4 percent to $3.3395 a pound in New York, the highest price since September 2008, on speculation that demand will strengthen and drain stockpiles. Platinum for immediate delivery rose as much as 1.9 percent to the highest intraday price since Dec. 4, and gold advanced 0.8 percent to $1,114.45 an ounce on speculation that some investors are increasing their holdings after the metal fell for a fourth week, the longest losing streak since April. Crude oil traded above $78 a barrel in New York after rising to a three- week high on signs that the U.S. economy is recovering. Corn for March delivery climbed for a third day, rising as much as 1.9 percent to the highest intraday price since Dec. 1 on the Chicago Board of Trade, on speculation that snow and ice may damage late-harvested U.S. crops. To contact the reporters for this story: Nicolas Johnson in Tokyo at nicojohnson@bloomberg.net; Matthew Brown in London at mbrown42@bloomberg.net.

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