Thursday, 3 November 2011

(BN) U.S. Futures Rise, Commodities Climb Before Fed; European Stocks Fluctuate

Bloomberg News, sent from my iPad.

S&P 500 Futures, Commodities Rise as Dollar Slips Before Fed

Nov. 2 (Bloomberg) -- U.S. stock futures and commodities advanced, while the dollar and Treasuries fell before the Federal Reserve's policy statement. European shares were little changed and the euro strengthened.

Standard & Poor's 500 Index futures jumped 0.5 percent at 8:20 a.m. in New York, extending gains after a private report showed companies added more jobs than forecast. The Stoxx Europe 600 Index rose less than 0.1 percent. The Dollar Index slid 0.5 percent, snapping a three-day advance. Treasury 10-year yields advanced nine basis points, the first increase in four days. The euro appreciated against 12 of its 16 major peers. Copper ended two days of declines.

The Fed is probably engineering a third round of asset purchases, even as a decision is unlikely to be announced today, economists surveyed by Bloomberg said. European leaders are due to hold emergency talks with Greek Prime Minister George Papandreou in Cannes, France, on the eve of a Group of 20 summit. French President Nicolas Sarkozy said yesterday the "only way" to repair Greek finances is through the deal hammered out last week.

"The dollar is softening into the meeting on talk of" quantitative easing, said Jane Foley, a senior currency strategist at Rabobank International in London. "That may be premature. We've had a glimmer of hope or optimism on the Greek situation," which supports the euro, she said.

The S&P 500 fell for a second day yesterday. Sixty-nine percent of economists surveyed by Bloomberg say Fed Chairman Ben S. Bernanke will start a third round of quantitative easing, or QE3, with 36 percent predicting the move in the first quarter of next year, according to a poll of 42 economists from Oct. 26-31.

Adding Workers

Companies added 110,000 workers to payrolls in October, according to data today from Roseland, New Jersey-based ADP Employer Services. The median forecast of 41 economists surveyed by Bloomberg News called for a advance of 100,000.

The Stoxx 600 has dropped 5.6 percent this week. Logica Plc sank 9.1 percent as the Anglo-Dutch computer services provider cut its sales-growth forecast.

The euro strengthened 0.7 percent to $1.3793, paring gains after the European Financial Stability Facility said it will delay a planned 3 billion-euro ($4.1 billion) bond sale because of market conditions. The dollar weakened 0.4 percent to 78.06 yen.

German bund yields were eight basis points higher after dropping 26 basis points yesterday, the biggest decline since Bloomberg began collecting the data in 1992. Greek two-year yields rose 505 basis points to a record 92.33 percent.

Germany sold 4 billion euros of five-year notes at a record-low yield of 1 percent, and Portugal raised 1.2 billion euros in a sale of three-month bills.

Copper climbed 2.8 percent as inventories of the metal in warehouses monitored by the London Metal Exchange dropped for a 10th consecutive day, the longest decline since July 6. New York oil rose 1.3 percent to $93.40 a barrel, the first gain in four days.

The MSCI Emerging Markets Index rose 0.8 percent, following its worst two-day decline in a month. The Hang Seng China Enterprises Index climbed 2.6 percent in Hong Kong. Russia's Micex Index advanced 2.2 percent.

To contact the reporter on this story: Stephen Kirkland in London at skirkland@bloomberg.net

To contact the editor responsible for this story: Stuart Wallace at swallace6@bloomberg.net

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