Euro gains with Spanish 10-year bonds on ECB as S&P 500 declines

Facebook Rebounds

Facebook Inc. advanced, rebounding from its lowest price since going public in May, as Chief Executive Officer Mark Zuckerberg said he won’t start selling his holdings in the social-networking company for at least a year.

Investors also awaited the U.S. government’s monthly employment report in two days. U.S. payrolls probably grew at a slower pace in August and unemployment exceeded 8 percent for a 43rd month, economists said before a Labor Department report on Sept. 7.

In the Stoxx 600, health, travel and insurance companies led gains, while oil companies and miners fell the most. BP Plc, the owner of the Macondo well that caused the worst U.S. oil spill, lost 2.9 percent after the Department of Justice reiterated it will pursue charges of gross negligence.

Krone Slumps

Norway’s krone weakened against all 16 major counterparts after a report showed Norwegian manufacturing unexpectedly contracted for a third straight month in August, adding to signs that the debt crisis is hurting exports in western Europe’s biggest oil producer.

Spanish two-year notes fell before the country sells as much as 3.5 billion euros ($4.4 billion) of securities due between 2014 and 2016 tomorrow. The Frankfurt-based ECB will refrain from setting a public cap on yields, according to three officials, who spoke on condition of anonymity.

Germany’s 10-year bunds dropped, sending yields up nine basis points to 1.48 percent, after the nation received bids for less than its maximum target at an auction.

U.S. companies from Cargill Inc. to Procter & Gamble Co. are selling bonds in Europe at the fastest pace since 2008 as they tap investor appetite for securities from borrowers outside the crisis-damaged euro region.

Euro-denominated offerings from American companies including Cincinnati-based P&G’s first deal in the currency since 2007 pushed sales to $5.7 billion last month, the busiest August in four years, data compiled by Bloomberg show. The surge brings this year’s total to $14.5 billion, the most for the period since 2010 and matching the amount for all of 2011.

The MSCI Emerging Markets Index fell 0.9 percent, headed for its lowest close since July 26. South Korea’s Kospi Index slid 1.7 percent as U.S. sales by Hyundai Motor Co. and Kia Motors Corp. missed some analysts’ estimates. The Hang Seng China Enterprises Index of mainland companies dropped 1.9 percent on a report China’s industrial output may slow. Russia’s Micex Index and India’s Sensex slipped at least 0.7 percent.

Bloomberg News

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