Stocks Climb, Euro Rises Before Debt Summit

By Stephen Kirkland and Shiyin Chen - Oct 19, 2011 4:22 PM GMT+0700

European stocks rose and the euro strengthened as leaders prepared to gather for a summit to stem the region’s debt crisis. U.S. index futures were little changed after Apple Inc. (AAPL)’s profit missed analyst estimates for the first time in at least six years.

The Stoxx Europe 600 Index advanced 0.7 percent at 10:17 a.m. in London and the MSCI All-Country World Index gained 0.5 percent. Standard & Poor’s 500 Index futures slipped less than 0.1 percent. Apple, the maker of the iPhone, sank 5.2 percent in European trading. Emerging-market stocks rebounded from the steepest loss in two weeks. The euro appreciated 0.4 percent to $1.3804. Spain’s two-year note yield climbed seven basis points after Moody’s Investors Service cut the nation’s credit rating. Copper retreated 1.5 percent and cocoa jumped 1.1 percent.

Europe’s leaders are set to meet Oct. 23 to discuss ways of increasing the region’s firepower in combating the credit crisis. The Guardian newspaper said yesterday Germany and France agreed to boost the area’s rescue fund, while a person with direct knowledge told Bloomberg News no deal has been reached. Apple’s income trailed the average estimate by 3.5 percent.

“Whatever progress we get out of the euro zone will certainly help add some calm to the market,” Kelvin Tay, the Singapore-based chief investment strategist at UBS Wealth Management, said in a Bloomberg Television interview. Investors will still remain “very wary” about finding a solution to the crisis, he said.

ING, Axa

Three shares advanced for every one that fell in the Stoxx 600, which snapped a two-day, 1.3 percent drop. ING Groep NV and Axa SA led gains in insurers, climbing more than 3.5 percent. Software AG surged 9.8 percent as Germany’s second-largest maker of business software said third-quarter operating profit rose.

Futures signaled the S&P 500 may give up some of yesterday’s 2 percent rally. Morgan Stanley and Freeport-McMoRan Copper & Gold Inc. are among 27 companies in the index scheduled to report earnings today. Among the 38 S&P 500 members that have released quarterly results since Oct. 11, more than 65 percent have beaten analysts’ profit estimates, according to data compiled by Bloomberg.

The MSCI Emerging Markets Index rose 1 percent after yesterday’s 1.7 percent slide. Banks led the Hang Seng China Enterprises Index of Chinese shares traded in Hong Kong 1.2 percent higher as lower money-market rates signaled the nation’s central bank will inject more funds into the financial system.

Turkey, South Korea

Turkey’s ISE National 100 Index (XU100) rose 0.5 percent. Anadolu Efes Biracilik & Malt Sanayii AS jumped as much as 10 percent after SABMiller Plc (SAB) said it will get a 24 percent stake in the Middle East’s biggest brewer in return for its Russian and Ukranian businesses. South Korea’s won strengthened 1.2 percent to a one-month high after the nation agreed to increase a currency-swap accord with Japan to $70 billion.

The euro appreciated 0.4 percent versus the yen, rising against all but two of its most-traded peers monitored by Bloomberg. The Dollar Index, which tracks the U.S. currency against those of six trading partners, fell 0.4 percent.

The pound declined versus most major counterparts after minutes from the Bank of England’s meeting this month showed officials voted unanimously to expand the size of their asset- purchase program.

The cost of insuring debt sold by Germany fell, with credit-default swaps tied to Europe’s largest economy declining six basis points to 88, the lowest since Sept. 16. The Markit iTraxx SovX Western Europe Index of contracts tied to 15 governments dropped 10 basis points to 324.

Copper fell for a third day to $7,333.50 a metric ton, leading industrial metals lower. Cocoa climbed to $2,600 a ton after falling yesterday to a two-year low. Oil rose 0.1 percent to $88.43 a barrel in New York.

To contact the reporter on this story: Stephen Kirkland in London at skirkland@bloomberg.net; Shiyin Chen in Singapore at schen37@bloomberg.net.

To contact the editor responsible for this story: Justin Carrigan at jcarrigan@bloomberg.net