By Stephen Kirkland and Lynn Thomasson - Jan 24, 2012 6:27 PM GMT+0700
Jan. 24 (Bloomberg) -- Jesper Koll, head of equity research at JPMorgan Chase & Co. in Tokyo, talks about the outlook for Japan's economy and stocks. He speaks with Susan Li on Bloomberg Television's "First Up." (Source: Bloomberg)
Jan. 24 (Bloomberg) -- John Vail, chief global strategist and head of asset allocation at Nikko Asset Management, talks about the outlook for Japan's economy, stocks and currency. Vail also discusses the impact of Europe's debt crisis on global financial markets. He speaks with Rishaad Salamat on Bloomberg Television's "On the Move Asia." (Source: Bloomberg)
Jan. 24 (Bloomberg) -- Travis Hamilton, managing director at Khan Investment Management Ltd., talks about investing in Mongolia, and the outlook for the country's stocks and economy. Hamilton speaks from Singapore with Rishaad Salamat on Bloomberg Television's "On the Move Asia." (Source: Bloomberg)
European stocks fell from a five- month high amid a stalemate between regional policy makers and Greek bondholders over how to resolve the nation’s debt crisis. Indian shares surged after the central bank unexpectedly cut the cash reserve ratio.
The Stoxx Europe 600 Index retreated 1.1 percent at 6:25 a.m. in New York. Standard & Poor’s 500 Index futures lost 0.6 percent, while the BSE India Sensitive Index jumped 1.5 percent. The Dollar Index (DXY), which tracks the U.S. currency against those of six trading partners, rose 0.1 percent. Germany’s 10-year bund yield decreased one basis point to 1.96 percent. Natural gas jumped 3 percent.
European finance ministers balked at putting up more public money for Greece, calling on bondholders to provide greater debt relief. Apple Inc., McDonald’s Corp. and Johnson & Johnson are among U.S. companies scheduled to report quarterly results today as the Federal Reserve begins a two-day policy meeting.
“There’s still a lot of uncertainty around Europe and the Greek restructuring issue is still to be resolved,” Shane Oliver, Sydney-based head of investment strategy at AMP Capital Investors Ltd., which has almost $100 billion under management, said in a Bloomberg Television interview. “After such a big run up in the last month or so, it wouldn’t surprise me to see markets correct a little bit.”
Five shares dropped for every one that gained in the Stoxx 600 (SXXP). The gauge has still risen 3.9 percent in 2012, the best start to a year since 1997. Societe Generale SA and Deutsche Bank AG led financial shares lower, retreating more than 3.5 percent. Royal KPN NV sank 6.4 percent, the most in five months, as the largest Dutch phone company predicted lower 2012 profit and cash flow.
Fed Survey
The decline in S&P 500 futures indicated the U.S. gauge will retreat from the highest level since July. The Richmond Federal Reserve Bank is due to release its manufacturing-sector activity survey for December at 10 a.m. New York time. Earnings have topped estimates at about 64 percent of the 56 companies in the S&P 500 that released results since Jan. 9, data compiled by Bloomberg show.
The yield on Spain’s two-year note fell five basis points to 3.12 percent as the government sold 2.51 billion euros ($3.3 billion of three- and six-month bills, meeting the maximum target for the sale. The Netherlands auctioned 1.84 billion euros of debt maturing in January 2013 and January 2042. The Dutch two-year yield was little changed at 0.24 percent.
The yield on the 10-year U.S. Treasury note was little changed at 2.06 percent before the government sells $35 billion of two-year securities.
Natural Gas Rallies
Natural gas rose as much as 3.6 percent after climbing 7.8 percent yesterday, the most since December 2009. Copper fell 0.3 percent and Brent oil declined 0.3 percent to $110.23 a barrel.
The MSCI Emerging Markets Index (MXEF) slipped 0.3 percent as declines in eastern Europe and Africa offset gains in India. Hungary’s BUX Index (BUX) fell 1.9 percent and Turkey’s ISE National 100 Index slipped 1.1 percent before central bank rate decisions. Benchmark gauges in Russia and South Africa slipped at least 0.7 percent.
India’s Sensex (SENSEX) jumped to the highest level since Nov. 14 after the central bank reduced its cash reserve ratio to 5.5 percent from 6 percent, the first cut to the amount of cash banks must put aside since 2009. Policy makers left borrowing costs unchanged.
To contact the reporters on this story: Stephen Kirkland in London at skirkland@bloomberg.net; Lynn Thomasson in Hong Kong at lthomasson@bloomberg.net;
To contact the editor responsible for this story: Stuart Wallace at Swallace6@bloomberg.net
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