By Alexis Xydias
Sept. 10 (Bloomberg) -- European and Asian shares climbed, sending the MSCI World Index higher for a sixth day, after Texas Instruments Inc. and ASML Holding NV raised their forecasts and China Yurun Food Group Ltd. reported higher earnings. U.S. index futures gained.
STMicroelectronics NV advanced 2.8 percent after Texas Instruments, the second-biggest U.S. chipmaker, boosted its sales and profit estimates on improving demand for analog chips. ASML, Europe’s largest maker of semiconductor equipment, soared 6.4 percent. China Yurun, the country’s biggest hog processor, jumped 7.4 percent as profit rose 37 percent.
The MSCI World added 0.2 percent to 1,108.92 at 10 a.m. in London, the highest level since October 2008. The index of 23 developed nations has surged 61 percent since March 9 as companies from Goldman Sachs Group Inc. to Roche Holding AG reported better-than-estimated results and the French and German economies unexpectedly expanded.
“The market is attractive even if we have had some very good performances,” said Jacques Porta, a fund manager at Ofi Patrimoine in Paris, which oversees about $425 million in equities. “Both macroeconomics and microeconomics, the reports from companies, seem to be supportive. The market could accelerate in the short term.”
‘High Quality Stocks’
Europe’s Dow Jones Stoxx 600 Index increased for a sixth day, adding 0.4 percent. The regional gauge is valued at 46.4 times profit, the highest level since 2003, Bloomberg data show.
“The market is fair value,” said Koen Jonckheere at KBC Asset Management in Brussels, whose KBC European equity fund is up 50 percent since March 9. “You can get high quality stocks at fair value. If you buy stocks you should be in for the long term.”
Futures on the Standard & Poor’s 500 Index advanced 0.3 percent today, indicating the benchmark gauge for U.S. stocks may rise for a fifth day. The MSCI Asia Pacific Index rallied 1.3 percent to a one-year high as Li & Fung Ltd., the biggest supplier of clothes and toys to Wal-Mart Stores Inc. and Target Corp., said it is seeing “pretty strong” re-orders from retailers.
The Shanghai Composite Index slipped 0.7 percent as Zhu Min, vice president of Bank of China Ltd. said increased lending has caused “bubbles” in stocks, commodities and real estate.
“The potential risk is that a lot of liquidity goes to the asset market,” Zhu said in an interview in Dalian today. “So you see asset bubbles in commodities, stocks and real estate, not only in China, but everywhere.”
ASML, STMicro
ASML surged 6.4 percent to 21.40 euros, leading a gauge of European technology stocks to the steepest gain among 19 industry groups on the Stoxx 600. The Dutch company said net sales will probably be more than 500 million euros ($728 million) in both the third and the fourth quarters as customers resume buying its machines.
STMicroelectronics, Europe’s biggest semiconductor maker, rose 2.8 percent to 6.64 euros, and Infineon Technologies AG, the second-largest, climbed 2.6 percent to 3.95 euros. Elpida Memory Inc., Japan’s biggest computer memory maker, added 3.4 percent to 1,319 yen in Tokyo.
Texas Instruments said yesterday that third-quarter profit will be 37 cents to 41 cents a share on sales of $2.73 billion to $2.87 billion. Analysts had projected profit of 35 cents a share and revenue of $2.68 billion on average, according to a Bloomberg survey.
Demand is beginning to recover for so-called analog chips - - semiconductors used in devices such as electronic utility meters, computer disk drives and consumer electronics. China and India led the rebound, Texas Instruments said. The shares were little changed at $25.14 in German trading.
‘Good Proxy’
“Texas Instruments is a good proxy for STMicroelectronics and Infineon,” Jerome Ramel and Steve Babureck, analysts at Exane BNP Paribas in Paris, wrote in a report. “We believe STMicroelectronics and Infineon will beat their guidance as well.”
China Yurun jumped 7.4 percent to HK$15.06 after first- half profit rose 37 percent to HK$841 million ($108.5 million).
Li & Fung gained 5 percent to HK$30.20. Bruce Rockowitz, the company’s president, told Bloomberg Television today that spending by consumers has started to “creep up.”
U.K. house prices rose 0.8 percent in August, a second straight gain, as low borrowing costs lured homebuyers, a report by Halifax showed today. That missed economists’ forecasts for a 1 percent increase.
Bank of England policy makers will probably keep pursuing their 175 billion-pound ($290 billion) emergency stimulus program today as the British economy shows signs of lagging behind the global recovery.
The central bank, led by Governor Mervyn King, will reiterate the size of its plan to buy bonds with newly created money, according to all 35 economists in a Bloomberg News survey. Policy makers will also keep the benchmark interest rate at a record low of 0.5 percent, all 60 economists in a separate survey said.
To contact the reporter on this story: Alexis Xydias in London at axydias@bloomberg.net.
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