Global Stocks Climb, Oil Advances; Citigroup, SocGen Lead Gains

By Adria Cimino

Oct. 14 (Bloomberg) -- Stocks climbed worldwide, driving the MSCI World Index to its biggest two-day gain on record, after the U.S. said it will invest about $125 billion in nine banks. Japan's Nikkei 225 Stock Average jumped the most ever.

Citigroup Inc., ING Groep NV and Royal Bank of Scotland Group Plc gained more than 10 percent in Europe. Societe Generale SA rallied 13 percent after posting a profit and saying it doesn't need additional capital. Oil headed for its biggest two-day advance in three weeks.

The MSCI World Index added 2.8 percent to 1,024.5 at 8:30 a.m., advancing 13 percent in two days, the most since records began in 1970. The U.S. investment in nine of the nation's biggest banks, including Citigroup and Goldman Sachs Group Inc. comes as France, Germany, Spain, the Netherlands and Austria pledged 1.3 trillion euros ($1.8 trillion) to guarantee bank loans and take stakes in lenders.

``The financial community of the central banks, the government, that are getting together and trying to be on the front foot, is something the market has been looking for, for a long time,'' said Jane Coffey, who oversees $63 billion at Royal London Asset Management in London. She spoke in a Bloomberg Television interview.

Europe's Dow Jones Stoxx 600 Index climbed 3.6 percent. The MSCI Asia Pacific Index surged 9.6 percent today, the most since 1998, with Japan's Nikkei jumping 14 percent as trading resumed following yesterday's public holiday.

Standard & Poor's 500 Index futures added 0.9 percent today, following yesterday's biggest rally in seven decades for the S&P 500.


Clawing Back Losses

The Stoxx 600 advanced 9.9 percent yesterday, clawing back more than a third of last week's 22 percent slump. The index has dropped 36 percent in 2008 as concern that frozen credit markets will trigger a recession erased about $28 trillion in value from global stock markets.

Financial firms have reported $636 billion in losses and writedowns from U.S. mortgage-related investments since the beginning of last year.

Citigroup gained 11 percent to $17.41 in Germany, and Goldman Sachs climbed 7.2 percent to $118.98.

The proposed cash injections in exchange for preferred shares are part of a $700 billion rescue approved by Congress. The other companies are Wells Fargo & Co., JPMorgan Chase & Co., Bank of America Corp., Merrill Lynch & Co., Morgan Stanley, State Street Corp. and Bank of New York Mellon Corp., said people briefed on the plan.

Treasury Secretary Henry Paulson, Federal Reserve Chairman Ben S. Bernanke and FDIC Chairman Sheila Bair are scheduled for a press conference at 8:30 a.m. today in Washington.

`Liquidity Being Thrown'

``We are now seeing solvency being dealt with, we are seeing huge amounts of liquidity being thrown at the market,'' Simon Ballard, a senior portfolio manager at Fortis Investments, said in a Bloomberg Television interview. ``Banks will little by little start to face one another in the interbank market.''

ING, the biggest Dutch financial-services provider, rallied 13 percent to 14.99 euros. Royal Bank of Scotland gained 13 percent to 74 pence.

Money-market rates fell across Asia after Japan and Australia pumped $15 billion into the financial system and global leaders pledged to buy stakes in banks, easing a credit crunch that's tipping the world toward recession.

U.S. Treasuries declined the most in two weeks and the euro and the pound rose against the dollar.

Societe Generale surged 13 percent to 55.15 euros. France's second-largest bank by market value, said it posted a profit in the third quarter and doesn't need additional capital. The bank will report ``positive'' net income for the period, the company said. Leaving aside one-time items, profit stood at about 1 billion euros, the bank said.

BHP, Total

BHP Billiton Ltd., the world's biggest mining company, added 5.7 percent to 1,100 pence, while Rio Tinto Group, the world's second-largest iron ore producer, jumped 6.4 percent 2,976 pence.

Total SA, Europe's biggest oil refiner, climbed 5.3 percent to 38.52 euros

Copper for delivery in three months on the London Metal Exchange rose as much as 7.5 percent to $5,500 a ton, bringing gains in the past two days to 13 percent, the most since at least 1986. Oil added 3.1 percent to $83.68 a barrel.

Cadbury Plc 3 percent to 513.5 pence. The world's largest confectioner said revenue increased in the third quarter by 6 percent, excluding acquisitions and disposals.

To contact the reporter on this story: Adria Cimino in Paris at acimino1@bloomberg.net.