July 19 (Bloomberg) -- Stocks rose for a third day, copper gained and the dollar weakened amid better-than-estimated corporate earnings and speculation monetary easing by global central banks will spur economic growth. Soybeans rose to a record as the worst drought since 1956 scorched U.S. fields.
The MSCI All-Country World Index advanced 0.6 percent at 8:45 a.m. in New York and Standard & Poor’s 500 Index futures added 0.5 percent. Copper climbed 2 percent in London and oil increased for a seventh day. Soybeans jumped 1.7 percent, wheat traded at a four-year high and corn rose to within 1 percent of a record. The Dollar Index retreated 0.3 percent to a two-week low. Spain’s 10-year bonds fell, pushing the yield above 7 percent, as borrowing costs increased at a debt auction.
Companies from International Business Machines Corp. to Akzo Nobel NV and Electrolux AB reported earnings that topped estimates. German lawmakers are due to vote to approve aid of as much as 100 billion euros ($123 billion) for Spain’s banks. First-time U.S. jobless claims increased and a report later today may show U.S. leading economic indicators fell, boosting prospects of further stimulus from the Federal Reserve.
“The market is pricing in further stimulus from the Fed,” Henk Potts, an equity strategist at Barclays Plc in London, said in an interview. His company oversees $239 billion. “Every time the Fed has acted, it’s driven up risky assets, so it could provide another boost to sentiment.”
China Support
China has “relatively large” room to boost fiscal spending to support economic growth as its budget deficit is still small and at a reasonable level, a government researcher said. The Bank of England restarted bond purchases this month to aid the economy and said the near-term outlook has “weakened.”
The Stoxx Europe 600 Index advanced 0.8 percent to the highest level since April 4 as Electrolux and Akzo Nobel climbed more than 4 percent.
Sandvik AB, the world’s biggest maker of metal-cutting tools, rallied 5 percent in Stockholm after reporting second- quarter profit that beat estimates on manufacturing demand in North and South America. Remy Cointreau SA surged 4.9 percent to a record as France’s second-largest distiller had first-quarter revenue growth that exceeded projections.
The gain in S&P 500 futures indicated the U.S. equities gauge will rise for a third day. International Business Machines Corp. increased 2.3 percent in pre-market New York trading after raising its full-year earnings forecast. EBay Inc., the world’s largest Internet marketplace, jumped 6 percent after reporting second-quarter sales and profit that beat estimates.
Earnings have exceeded analyst forecasts at 70 percent of the 99 companies in the S&P 500 that have reported results this month, according to data compiled by Bloomberg. Profits are little changed for the group and projected to have decreased 2.1 percent for the entire index in the second quarter, which would mark the first year-over-year decrease since 2009.
The Conference Board’s gauge of the U.S. economic outlook for the next three to six months fell 0.1 percent in June, according to the median estimate in a Bloomberg survey of 49 economists.
Other data are forecast to show sales of previously owned U.S. homes climbed 1.5 percent in June, and manufacturing in the Philadelphia region shrank at a slower pace this month.
Three-month copper traded at $7,790 a metric ton on the London Metal Exchange, rising for a second day.
Oil Rises
Oil rose for a seventh day, the longest rally since February, as U.S. gasoline stockpiles unexpectedly declined. Futures climbed as much as 1.5 percent to a seven-week high of $91.25 a barrel in New York. Gasoline supplies fell by 1.8 million barrels, according to an Energy Department report. They were forecast to rise by 1.2 million barrels, according to a Bloomberg survey.
United Nations Certified Emission Reduction offsets for December dropped as much as 4.7 percent to a record 2.83 euros a metric ton on the ICE Futures Europe exchange in London as European Union officials struggle to cope with an oversupply of carbon permits.
Grains and oilseeds helped lead commodities higher as the worst U.S. drought since 1956 curbed crop prospects for the world’s biggest producer. More than half of the contiguous U.S. states were in moderate to extreme drought at the end of June, the highest percentage since December 1956, according to the National Climatic Data Center.
Soybean futures for November delivery on the Chicago Board of Trade rallied 1.7 percent to $16.4675 a bushel, extending this year’s gain to 36 percent. Wheat jumped as much as 2 percent to $9.2125 a bushel, the most since August 2008, and corn climbed 1.8 percent to $7.98 a bushel, the highest since June 2008. The all-time high for corn is $7.9925 a bushel.
Spain’s 10-year bond yield rose six basis points to 7.02 percent. The nation sold bonds due in 2014 at an average yield of 5.204 percent, compared with 4.335 percent when they were last sold on June 7. It sold five-year notes at 6.459 percent, compared with 6.072 percent on June 21 and seven-year securities at an average yield of 6.701 percent.
Demand for the two-year debt was 1.9 times the amount sold, compared with 4.26 last month and the bid-to-cover for the 2017 securities was 2.06, compared with 3.44 in June, the Bank of Spain said.
Rates on Austrian, Belgian and French debt fell to record lows. Yields on two-year Treasuries were at the lowest level since January.
The cost of insuring European corporate debt declined for a third day, with the Markit iTraxx Europe Index of 125 investment-grade companies dropping two basis points to a two- week low of 160.5.
The MSCI Emerging Markets Index climbed 1.2 percent, on course for its biggest gain in a week and its highest close since July 6. The Hang Seng China Enterprises Index of Chinese companies listed in Hong Kong jumped 2.4 percent, the most this month. China’s Premier Wen Jiabao will probably decide to reduce banks’ reserve requirements and encourage corporate lending as the cabinet meets to discuss efforts to revive economic growth, the swap market indicates. Benchmark indexes in South Korea and Taiwan gained more than 1 percent.
Russia’s Micex Index jumped 1 percent as oil gained. The ruble strengthened 1 percent against the dollar, trading at the highest level since May.
