By Julie Cruz - Dec 2, 2011 7:24 PM GMT+0700
European stocks climbed, with the Stoxx Europe 600 Index extending its largest weekly rally since November 2008, before a report that may show the U.S. economy added workers at a faster pace last month. U.S. index futures and Asian shares also gained.
Commerzbank AG (CBK) rose 5.5 percent after a report that the lender has a plan to shore up its capital without state aid. Home Retail Group Plc (HOME) surged following a report that private- equity firms CVC Capital Partners and Bridgepoint Capital Holdings may be considering a cash bid.
The Stoxx 600 (SXXP) rose 1.2 percent to 241.42 at 12:22 p.m. in London. Standard & Poor’s 500 Index futures expiring this month climbed 1.1 percent, while the MSCI Asia Pacific Index increased 0.4 percent.
The Stoxx 600 has rallied 9 percent this week, its biggest advance in three years, as the European Central Bank and five other central banks lowered the cost of dollar funding, China cut its reserve-requirement ratio for banks and U.S. consumer confidence unexpectedly rose in November.
“Overall, we have positive U.S. economic data,” said Heinz-Gerd Sonnenschein, an equity strategist at Deutsche Postbank AG in Bonn. “I don’t expect disappointing payrolls data. The market is still very nervous, but I am optimistic for the end of the year.”
The Labor Department report at 8:30 a.m. in Washington today may show payrolls climbed by 125,000 workers in November, following the 80,000 increase in October, according to the median forecast of 90 economists surveyed by Bloomberg News. The jobless rate held at 9 percent, economists said.
Budget Monitoring
German Chancellor Angela Merkel said that only fiscal union will tackle the euro area’s debt crisis at its roots, as she used a speech to lawmakers in Berlin today to outline her position before a European Union summit on Dec. 9. The euro area needs fiscal oversight that’s “binding” and punishes states that persistently breach debt and deficit rules, Merkel said.
French President Nicolas Sarkozy called for “more discipline” and automatic penalties for nations that break fiscal rules late yesterday. In his speech in Toulon, France, Sarkozy said the 17-nation euro area, bound by a currency introduced a decade ago and intended to be permanent, risked “exploding” if members failed to converge.
ECB President Mario Draghi signaled yesterday that the European Central Bank could do more to fight the sovereign-debt crisis in return for closer fiscal union.
Commerzbank Shares Rally
Commerzbank gained 5.5 percent to 1.43 euros as Die Welt said Germany’s second-biggest bank could generate about 1 billion euros ($1.4 billion) by retaining profit through June 30. The lender could boost its core capital by 3 billion euros by offloading some 30 billion euros in risk-weighted assets, the newspaper said, citing options that its supervisory board will discuss today. The lender could also generate as much as 6 billion euros by converting hybrid capital, according to Die Welt. The German newspaper cited banking officials.
Banking shares were the best-performing industry today, soaring 3.7 percent. HSBC Holdings Plc (HSBA) rose 3 percent to 510.6 pence in London, while BNP Paribas (BNP) SA surged 7.9 percent to 31.15 euros.
Home Retail jumped 8.5 percent to 98.1 pence, its highest price in a month. CVC and Bridgepoint are working on a deal that would value the owner of the Argos chain at a “significant premium” to its market price, the Daily Mail said today. Spokesmen for Home Retail, Bridgepoint and CVC declined to comment.
Mining Companies Climb
BHP Billiton Ltd. (BHP) and Rio Tinto Group (RIO), the world’s biggest mining companies, led gains in commodity stocks, rising 4.6 percent to 2,010.5 pence and 2.3 percent to 3,379 pence, respectively. The industry was among the best performers in the Stoxx 600 this week, surging 13 percent. Aluminum, copper, lead, nickel and zinc all climbed on the London Metal Exchange today.
Bayerische Motoren Werke AG (BMW) and Daimler AG advanced 2.7 percent to 56.68 euros and 3.3 percent to 34.44 euros, respectively. A report from Autodata Corp. yesterday showed that U.S. light-vehicle sales accelerated to their fastest pace in 2011. Daimler sells more than 17 percent of its vehicles in the U.S., Bloomberg data shows.
Separately, Daimler plans to cut production costs by 10 percent annually in 2012 and 2013, Reuters reported, citing Wolfgang Nieke, a works council member.
Neopost SA gained 1.8 percent to 52.51 euros as it said after the market close yesterday that its third-quarter revenue (NEO) rose to 242 million euros from 233.7 million euros a year earlier. Neopost also confirmed its full-year outlook.
ThyssenKrupp AG (TKA) fell 2.3 percent to 18.58 euros after Germany’s biggest steelmaker posted a fiscal full-year loss because of 2.9 billion euros of impairments charges, mostly after construction of a plant in Brazil was delayed.
-- Editors: Will Hadfield, Srinivasan Sivabalan
To contact the reporter on this story: Julie Cruz in Frankfurt at jcruz6@bloomberg.net
To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net
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