Most U.S. stocks rose as a jump in
housing starts to a four-year high overshadowed earnings that
disappointed investors at two of the largest technology
companies. Treasuries fell, while the euro climbed with Spanish
and Italian bonds.
The Standard & Poor’s 500 Index added 0.4 percent to 1,460.61 at 1:21 p.m. in New York as homebuilders advanced while International Business Machines Corp. and Intel (INTC) Corp. retreated after reporting earnings. About two stocks climbed for each that fell in the U.S. The euro gained 0.6 percent to $1.3128. Spain’s 10-year bond yield dropped 34 basis points to 5.47 percent, while Italian rates sank 17 basis points. Ten-year U.S. yields added eight basis points to 1.80 percent.
An index of 11 homebuilders surged 3.8 percent to above its
highest closing level in five years after housing starts jumped
15 percent to an 872,000 annual rate last month, exceeding all
forecasts in a Bloomberg survey of economists. Spain maintained
its investment-grade debt rating from Moody’s Investors Service,
which said there’s less risk of losing market access because of
the European Central Bank’s willingness to buy the nation’s
debt.
“The economic data suggest that this continues to be a slow, grinding recovery,” Stephen Wood, the New York-based chief market strategist for North America for Russell Investments, which oversees $152 billion, said in a phone interview. “Not every company will execute or outperform in a challenging environment, which means security selection becomes a more-important investment strategy.”
Technology shares declined 0.5 percent as a group, the biggest drop among 10 industries. Intel, the world’s largest chipmaker, slipped 2.9 percent after forecasting fourth-quarter gross margins that missed analysts’ estimates.
IBM, the biggest computer-services provider, dropped 5.6 percent to $199.24 after reporting third-quarter revenue that fell short of projections. IBM, which accounts for more than 11 percent of the share-price-weighted Dow Jones Industrial Average, took 90 points off the gauge today. The Dow was 11 points lower even as 25 of its 30 companies advanced.
Japan’s Nikkei 225 Stock Average advanced 1.2 percent as Kyodo News reported Prime Minister Yoshihiko Noda will instruct his cabinet today to craft new economic stimulus measures.
Italy’s two-year notes rose, pushing the yield down 11 basis points to 2.01 percent, while Portugal’s 10-year yield fell below 8 percent. The yield on German 10-year bonds climbed nine basis points to 1.63 percent.
The euro rose against all but five of its 16 major peers, climbing 0.4 percent to 103.41 yen. Japan’s currency strengthened 0.1 percent to 78.77 yen per dollar.
Moody’s assigned a negative outlook on the Baa3 sovereign debt, one step above junk, as it concluded the review for a possible further downgrade of Spain’s rating that it had initiated in June. The nation avoided joining euro-region peers Cyprus, Portugal, Ireland and Greece as being rated below investment grade.
Fortress Investment turned bullish on China after betting on declines earlier in the year as it predicts the government will arrest a seven-quarter slowdown in the economy, Adam Levinson, chief executive officer of the hedge fund’s Singapore unit and manager of its Asia Macro Fund, said in an interview yesterday. Fortress manages $47.8 billion of assets globally.
Cotton futures rose the exchange limit 3 cents to 77.86 cents a pound, the highest in almost six months, after inventories fell to the lowest in at least 10 years in the U.S., the world’s biggest exporter. Aluminum, lead, copper and nickel advanced at least 1.6 percent as 16 of 24 commodities tracked by the S&P GSCI Index advanced.
New York-traded oil was little changed at $92.03 a barrel, erasing earlier gains as government data showed supplies rose to the highest level for this time of year since government records began in 1982.
The Standard & Poor’s 500 Index added 0.4 percent to 1,460.61 at 1:21 p.m. in New York as homebuilders advanced while International Business Machines Corp. and Intel (INTC) Corp. retreated after reporting earnings. About two stocks climbed for each that fell in the U.S. The euro gained 0.6 percent to $1.3128. Spain’s 10-year bond yield dropped 34 basis points to 5.47 percent, while Italian rates sank 17 basis points. Ten-year U.S. yields added eight basis points to 1.80 percent.
The euro rose against all but one
of its 16 major peers, climbing 0.3 percent to 103.27 yen.
Photographer: Simon Dawson/Bloomberg
Oct. 17 (Bloomberg) --
New-home construction in the U.S. surged 15 percent in September to an
872,000 annual rate, the most since July 2008 and exceeding all
forecasts in a Bloomberg survey of economists, Commerce Department
figures showed today in Washington.
Betty Liu and Michael McKee report on Bloomberg Television's "In
the Loop." (Source: Bloomberg)
“The economic data suggest that this continues to be a slow, grinding recovery,” Stephen Wood, the New York-based chief market strategist for North America for Russell Investments, which oversees $152 billion, said in a phone interview. “Not every company will execute or outperform in a challenging environment, which means security selection becomes a more-important investment strategy.”
Market Leaders
The S&P 500 extended its three-day rally to more than 2 percent, the biggest gain in a month. Indexes of financial, energy and consumer-discretionary companies contributed the most to the advance in the S&P 500 amid 10 industries. PulteGroup Inc., Masco Corp., Lennar Corp. and D.R. Horton Inc. climbed at least 2.8 percent to lead gains among housing-related stocks.Technology shares declined 0.5 percent as a group, the biggest drop among 10 industries. Intel, the world’s largest chipmaker, slipped 2.9 percent after forecasting fourth-quarter gross margins that missed analysts’ estimates.
IBM, the biggest computer-services provider, dropped 5.6 percent to $199.24 after reporting third-quarter revenue that fell short of projections. IBM, which accounts for more than 11 percent of the share-price-weighted Dow Jones Industrial Average, took 90 points off the gauge today. The Dow was 11 points lower even as 25 of its 30 companies advanced.
European Markets
The Stoxx Europe 600 Index (SXXP) rose 0.5 percent after the biggest two-day rally in five weeks. ASML Holding NV dropped 5.3 percent as Europe’s largest semiconductor equipment maker forecast fourth-quarter sales that trailed behind projections. PSA Peugeot Citroen (UG) advanced 4.1 percent as Le Figaro said the French government and banks may bail out the automaker’s credit unit.Japan’s Nikkei 225 Stock Average advanced 1.2 percent as Kyodo News reported Prime Minister Yoshihiko Noda will instruct his cabinet today to craft new economic stimulus measures.
Italy’s two-year notes rose, pushing the yield down 11 basis points to 2.01 percent, while Portugal’s 10-year yield fell below 8 percent. The yield on German 10-year bonds climbed nine basis points to 1.63 percent.
The euro rose against all but five of its 16 major peers, climbing 0.4 percent to 103.41 yen. Japan’s currency strengthened 0.1 percent to 78.77 yen per dollar.
Default Swaps
The cost of insuring against default on Spanish and Italian government debt fell to the lowest in more than a year. Credit- default swaps on Spain tumbled 51 basis points to 272 and contracts on Italy dropped 41 to 234 basis points.Moody’s assigned a negative outlook on the Baa3 sovereign debt, one step above junk, as it concluded the review for a possible further downgrade of Spain’s rating that it had initiated in June. The nation avoided joining euro-region peers Cyprus, Portugal, Ireland and Greece as being rated below investment grade.
Yuan High
China’s yuan rose to a 19-year high as the central bank raised its daily fixing to 6.3028 a dollar. Mitt Romney said in a second televised U.S. election debate with President Barack Obama that he will declare China a currency manipulator on his first day in the White House.Fortress Investment turned bullish on China after betting on declines earlier in the year as it predicts the government will arrest a seven-quarter slowdown in the economy, Adam Levinson, chief executive officer of the hedge fund’s Singapore unit and manager of its Asia Macro Fund, said in an interview yesterday. Fortress manages $47.8 billion of assets globally.
Cotton futures rose the exchange limit 3 cents to 77.86 cents a pound, the highest in almost six months, after inventories fell to the lowest in at least 10 years in the U.S., the world’s biggest exporter. Aluminum, lead, copper and nickel advanced at least 1.6 percent as 16 of 24 commodities tracked by the S&P GSCI Index advanced.
New York-traded oil was little changed at $92.03 a barrel, erasing earlier gains as government data showed supplies rose to the highest level for this time of year since government records began in 1982.
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