Global Stocks Erase 2016 Losses on China Data

Iron ore jumps to 3-week high in China; crude oil re­treats be­fore pro­duc­ers’ meet

The Economic Times - - Companies -

Sin­ga­pore: The cloud that China cast over fi­nan­cial mar­kets is start­ing to lift — and that’s a boon for stocks and com­modi­ties. Af­ter trade data pointed to stronger growth in the world’s sec­ond-big­gest econ­omy, global eq­ui­ties wiped out the last of this year’s losses, cop­per and iron ore jumped, and haven as­sets in­clud­ing the yen and gold re­treated. The dol­lar ral­lied the most in three weeks af­ter fall­ing to a nine-month low.

Af­ter roil­ing fi­nan­cial mar­kets in the first six weeks of the year, signs that the slow­down in the Chi­nese econ­omy may not be as deep as some in­vestors ex­pected fu­eled a re­cov­ery in stocks from Asia to Amer­ica. Spec­u­la­tion the oil mar­ket will soon find some en­dur­ing sta­bil­ity is also help­ing to prop up eq­ui­ties, even as in­vestors brace for what’s pro­jected to be the worst US earn­ings sea­son since the global fi­nan­cial crisis.

The Stan­dard & Poor’s 500 In­dex joined the global eq­ui­ties rally, with JPMor­gan Chase ris­ing af­ter re­port­ing earn­ings beat es­ti­mates. Euro­pean stocks rose for a fourth


day, shares in emerg­ing mar­kets climbed to the high­est since Novem­ber, and China’s eq­ui­ties traded in Hong Kong gained the most world­wide. Rus­sian stocks headed for their high­est close since 2008. US crude slid, af­ter surg­ing 13% in three days be­fore pro­duc­ers meet to dis­cuss out­put at a meet­ing in Doha this week­end.

Stocks The MSCI All-Coun­try World In­dex climbed 1.1% at 10:32 a.m. in New York, eras­ing a slide in 2016 that reached 12% and plunged the gauge into a bear mar­ket. The in­dex has ral­lied more than 13% since.

The S&P 500 rose 0.5%, adding to a 1% rally on Tues­day even as data showed showed re­tail sales and whole­sale prices un­ex­pect­edly slumped last month, cast­ing doubt on both the strength of con­sumer de­mand and nascent in­fla­tion.

The Stoxx Europe 600 In­dex rose 2.1%, head­ing for its long­est win­ning streak in more than a month. The MSCI Asia Pa­cific In­dex jumped 1.9% to the high­est close since Jan­uary 1. The Hang Seng China En­ter­prises In­dex of main­land shares listed in Hong Kong jumped 4%. The MSCI Emerg­ing Mar­kets In­dex rose for a fifth day, climb­ing 1.2%.

Cur­ren­cies The Bloomberg Dol­lar Spot In­dex, which tracks the green­back ver­sus 10 peers, rose 0.5%, af­ter reach­ing a nine-month low Tues­day. The US cur­rency added 0.7% to $1.1311 per euro, its strong­est in two weeks, and gained 0.6% to 109.17 yen.

San Fran­cisco Federal Re­serve Pres­i­dent John Wil­liams’ said on Tues­day that two or three in­ter­est rate in­creases this year was a rea­son­able call.

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