Tags: europe | stocks | greece | bonds | invest

Europe Stocks, Greek Notes Rise on Aid Approval

Monday, 04 Jul 2011 02:22 PM

Most stocks rose in Europe and Greek two-year notes advanced for a fifth day after officials approved an aid payment to Greece to prevent a default. Zinc climbed to a two-month high and oil advanced 0.1 percent.

The Stoxx Europe 600 Index added 0.2 percent at 1:32 p.m. in New York as more than two stocks gained for every one that fell, while Standard & Poor’s 500 Index futures slipped 0.1 percent. U.S. markets are closed for the Independence Day holiday. Thai stocks jumped the most in 14 months after the opposition won elections. The Greek two-year note yield dropped below 26 percent for the first time since June 14. Zinc rose 1.4 percent while oil climbed to near a two-week high.

Europe’s finance ministers authorized an 8.7 billion-euro ($12.6 billion) loan payout to Greece by mid-July and said they would aim to complete talks with banks on maintaining their Greek debt holdings within weeks. Stocks pared gains after S&P said a rollover plan serving as the basis for talks between investors and governments would qualify as a distressed exchange and prompt a “selective default” rating.

“The threat by S&P to put Greece in selective default in case of a debt rollover seems to be the proverbial ‘fly in the soup’ for risk appetite as the week opens,” Greg Venizelos, a credit strategist at BNP Paribas SA in London, wrote in a note. “Overall however, we are in a better place risk-wise than this time last week.”

The gain in the Stoxx 600 extended last week’s biggest rally in almost a year. RWE AG rose 0.8 percent after a person familiar with the matter said the German utility is considering a sale of its Npower unit. Strategists at Deutsche Bank AG and Nomura Holdings Inc. turned bullish on European stocks, saying it’s time to buy shares as risks to global economic growth wane.

Greek Notes

Greek two-year yields slid 73 points to 26.11 percent, at one point dipping to 25.76 percent. The cost of insuring Greek debt against default rose four basis points to 1,865, signaling 80 percent odds the country will miss a bond payment in five years. The Markit iTraxx SovX Western Europe Index of credit- default swaps on 15 governments climbed four basis points to 222.

The Swiss franc slid against 13 of its 16 major peers. The euro slipped less than 0.1 percent against the dollar and 0.1 versus the yen.

Zinc gained as much as 1.4 percent to $2,398 a metric ton, the highest since April 18. Gold climbed for the first time in three days as some investors bought the metal after its drop to a six-week low and as a weaker dollar spurred demand for an alternative asset. Gold rose 0.9 percent in London to $1,496.50 an ounce.

Sugar and coffee fell in London, while cocoa advanced.

Crude Oil Climbs

Oil in New York traded near a two-week high, climbing as much as 0.6 percent to $95.47 a barrel before paring to $95. Brent crude gained as much as 0.4 percent after Goldman Sachs Group Inc. said the “downside risk” to oil would be “reduced proportionately” as sales of stockpiles from members of the International Energy Agency might be less than announced. The European benchmark contract rose to $111.38, a premium of $16.38 to U.S. futures. The spread reached a record $22.29 on June 15.

The MSCI All-Country World Index climbed 0.5 percent, its sixth straight gain and the longest winning streak since March. The MSCI Asia Pacific Index rallied 1.2 percent. The MSCI Emerging Markets Index jumped 1.1 percent, on course for the highest close since May 4.

Canada, Thailand

Most Canadian stocks rose for a fifth day, the longest streak of advances in almost three months. The Standard & Poor’s/TSX Composite Index increased 0.8 percent in Toronto. Brazil’s Bovespa Index climbed 0.1 percent.

Thailand’s SET Index rose 4.7 percent, the most since April 2010, and the baht strengthened 0.9 percent against the dollar after the election victory by allies of exiled premier Thaksin Shinawatra. The Shanghai Composite gained 1.9 percent to the highest close since May 20 after a report showed a slowdown in manufacturing, boosting speculation China will refrain from increasing interest rates.

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Most stocks rose in Europe and Greek two-year notes advanced for a fifth day after officials approved an aid payment to Greece to prevent a default. Zinc climbed to a two-month high and oil advanced 0.1 percent.The Stoxx Europe 600 Index added 0.2 percent at 1:32 p.m. in...
europe,stocks,greece,bonds,invest
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2011-22-04
 

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