Ukraine tensions ease
Stocks in Europe advanced as a cease-fire agreement for Ukraine raised optimism the country’s yearlong crisis will be contained. The yen gained as people familiar with Bank of Japan talks said further stimulus is viewed as counterproductive. Greek markets climbed and crude oil rose.
The Stoxx Europe 600 Index of shares rose 0.9% at 8:30 a.m. in New York, with futures on the Standard & Poor’s 500 Index adding 0.4%. While credit-default swaps on Russia fell to the lowest since Jan. 2, Ukraine’s hryvnia fell on concern that the peace deal may not hold for long. Greece’s ASE Index of equities gained 4.3% and the yield on three-year notes fell 232 basis points to 18.43%. The yen appreciated 0.8% against the dollar. Oil advanced for the first time in three days.
The accord for eastern Ukraine is to start Feb. 15, Russian President Vladimir Putin told reporters in Minsk, Belarus, after talks with French, German and Ukrainian leaders. At a separate meeting in Brussels, last-minute questions from the government in Athens snagged progress toward an agreement with creditors, and talks will resume Feb. 16. The BOJ is concerned further monetary easing may trigger declines in the yen that damage confidence, people familiar with the talks said. U.S. retail sales fell.
“Hopefully the cease-fire in Ukraine will allow investors to move on,” Kully Samra, who manages U.K. clients for Charles Schwab Corp. in London, said by phone. “That’s helping push markets higher. People also seem to be looking beyond the fact that there is no deal on Greece yet.”
The MSCI All-Country World Index added 0.5%. Sales at U.S. retailers declined 0.8% in January, following a 0.9% decrease in the prior month, Commerce Department figures showed Thursday in Washington. The median forecast of economists surveyed by Bloomberg called for a 0.4% drop. Applications for unemployment benefits climbed last week, a separate report showed.
Treasuries rose after the data, pushing the 10-year note yield two basis points lower to 2%. The U.S. sells 30- year bonds today.
In Europe, Germany’s DAX advanced 1.7% and automakers and miners in the Stoxx 600 rallied the most among 19 industry groups. Renault SA gained 8.9% after reporting that 2014 earnings jumped 30%, beating analysts’ estimates. Peugeot SA, which posts results next week, advanced 3.3%.
Credit Suisse Group AG jumped 9.8% after returning to profit, Rio Tinto Group rose 3.6% as the world’s second-largest mining company reported better-than-forecast annual earnings and Publicis Groupe SA gained 3.7% after quarterly revenue beat estimates.