European Stock-Index Futures Gain; Rio Tinto Shares May Rise

By Adam Haigh

Jan. 6 (Bloomberg) -- European stock-index futures rose, indicating the Dow Jones Stoxx 600 Index may extend a five-day rally, as government efforts to revive the global economy overshadowed a slump in consumer confidence in the U.K.

Rio Tinto Group gained 2.7 percent in Australia as copper jumped to the highest in almost a month in Asia. Next Plc, the U.K.’s second-largest clothes retailer, may advance after maintaining its full-year profit forecast. Telenor ASA, Norway’s largest phone company, may increase as Morgan Stanley advised clients to buy the shares.

The Stoxx 600 has rebounded 15 percent since Nov. 21 as investors speculated that U.S. President-elect Barack Obama will stimulate the world’s biggest economy with tax cuts and the largest infrastructure investment since the 1950s, while the Federal Reserve cut interest rates to as low as zero percent.

“Equities now appear to be regaining a bit of confidence,” Roger Nightingale, who helps oversee about $1.1 billion as a London-based strategist at Pointon York Ltd., said in an interview on Bloomberg Television. “What is important is what the Fed and central banks are doing. What they have done is create liquidity.”

Futures on the Dow Jones Euro Stoxx 50 Index, a benchmark for the euro region, added 0.5 percent to 2,564 at 7:46 a.m. in London. The U.K.’s FTSE 100 Index is set to open 11 points higher, according to IG Markets.

The MSCI Asia Pacific Index climbed for a ninth day, adding 0.1 percent. Futures on the Standard & Poor’s 500 Index increased 0.2 percent. The benchmark index for American equities fell for the first time in four days yesterday on concern that a slump in corporate profits will stretch into 2009.

U.K. Consumer Confidence

A deepening recession and rising unemployment sent consumer confidence in the U.K. to the lowest since at least 2004 in December, Nationwide Building Society said.

An index of sentiment fell four points from a month earlier to 47, the worst since the survey began four years ago, the mortgage lender said in a statement today. The reading, taken from a survey of 1,000 people between Nov. 17 and Dec. 14, compares with 84 points a year earlier.

Rio Tinto, the world’s third largest mining company, added 2.7 percent to A$43.42. Copper rallied 3.8 percent in London.

Next may rise. The retailer said its full-year profit forecast remains “in line with our previous expectation” as it reported a decline in revenue.

Telenor may gain. Morgan Stanley raised its recommendation on the stock to “overweight” from “equal-weight.”

Logitech, U.K. Banks

Logitech International SA may drop after the world’s biggest maker of computer mice withdrew its fiscal 2009 financial targets and said it will cut 15 percent of its salaried workforce because of the deepening global recession.

U.K. financial shares may move. Royal Bank of Scotland Group Plc, Barclays Plc, HBOS Plc and 31 other British financial companies will no longer have protection from short-selling, Britain’s financial regulator said yesterday.

The temporary ban on short-selling, introduced in September after politicians and investors blamed the practice for market instability, will expire on Jan. 16, the Financial Services Authority said. The London-based agency said it could be reintroduced without consultation if necessary.

An index of companies that the FSA prohibited hedge funds and other investors from shorting fell three times more than the broader FTSE All-Share Index, data compiled by Bloomberg show.

Metro AG, Germany’s largest retailer, may slide after Merrill Lynch & Co. cut its recommendation on the shares to “underperform” from “buy.”

To contact the reporter on this story: Adam Haigh in London at ahaigh1@bloomberg.net