Stocks Climb for Fourth Day as Metals Rally on China Measures, Greek Talks

By Stephen Kirkland and Lynn Thomasson - Feb 20, 2012 4:40 PM GMT+0700

Stocks rose for a fourth day and metals rallied after China’s central bank cut reserve requirements for lenders, while the euro strengthened as European leaders prepared to discuss a Greek rescue. Oil climbed to a nine-month high as Iran said it halted some crude exports.

The MSCI All-Country World Index (MXWD) gained 0.5 percent at 9:38 a.m. in London. Standard & Poor’s 500 Index futures advanced 0.2 percent. U.S. markets are closed for the Presidents’ Day holiday. Copper rose for the first time in seven days and oil jumped 1.4 percent. The euro appreciated 0.5 percent to $1.3202. The yield on the German 10-year bund rose two basis points.

Finance ministers gathering today in Brussels will try to settle remaining disputes to wrap up a 130 billion-euro ($170 billion) bailout to fend off a Greek default. The proportion of cash that Chinese lenders must set aside will be cut by half a percentage point from Feb. 24, the central bank said Feb. 18.

“The euro zone is close to agreeing on a deal to avoid a potentially disastrous Greek default and euro-zone exit,” Christian Schulz, an economist at Berenberg Bank in London, wrote in a research note. “The time which has been gained with these decisions is being used wisely, most countries are making considerable progress with their reforms. The rebound in confidence could lead the currency union back to growth this summer.”

TNT Bid

The Stoxx Europe 600 Index (SXXP) climbed 0.6 percent to the highest since Aug. 1. TNT Express NV surged 55 percent after Europe’s second-largest express-delivery service rejected a $6.43 billion takeover offer from United Parcel Service Inc. PostNL NV, which owns 29.9 percent of TNT Express after a spin off from Dutch postal operator TNT NV in May, rose 47 percent.

The euro climbed 0.3 percent versus the yen. The Dollar Index (DXY), which tracks the U.S. currency against those of six trading partners, declined 0.4 percent. The yen weakened against 13 of 16 major counterparts monitored by Bloomberg.

The yield on the Greek bond due October 2022 declined 27 basis points to 34.11 percent, with the price rising to 20.73 percent of face value, while the similar-maturity Italian note yield fell five basis points. The Spanish yield slipped two basis points.

The cost of insuring against default of European financial- company debt fell to the lowest in two weeks, with the Markit iTraxx Financial Index of credit-default swaps linked to 25 banks and insurers dropping six basis points to 216.5.

Copper advanced 1.4 percent. Oil in New York jumped as much as 1.9 percent to $105.21 a barrel, the highest price for a most-active contract since May 5.

The MSCI Emerging Markets Index (MXEF) increased 0.2 percent, on course for its highest closing level since Aug. 4. Russia’s Micex Index (MICEX) rose 0.9 percent on higher oil. Benchmark gauges climbed 1.5 percent in Hungary and 0.8 percent in Turkey and Taiwan. The Shanghai Composite Index (SHCOMP) added 0.3 percent, while the Hang Seng China Enterprises Index of Chinese stocks listed in Hong Kong retreated 0.4 percent.

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: Mark Gilbert at magilbert@bloomberg.net