Torres Helps Spain Rout Ireland at Euro 2012; Croatia Ties Italy

By Bob Bensch - Jun 15, 2012 5:01 AM GMT+0700

Fernando Torres had two goals as Spain routed Ireland 4-0 to move into a tie atop Group C at the European soccer championship with Croatia, which rallied to draw 1-1 against Italy.

David Silva and Cesc Fabregas also scored last night in defending champion Spain’s win in Gdansk, Poland. Mario Mandzukic’s 72nd-minute score earned Croatia the point with Italy in Poznan.

Spain and Croatia have four points ahead of their meeting in the final round of group matches on June 18. The top two teams in each group advance to the quarterfinals.

“After two matches this is a really good situation,” Croatia coach Slaven Bilic said on UEFA’s website. “Six points would have been better, but this is pretty good.”

Italy has two points and Ireland, which was eliminated by its second straight loss, has none. They meet in the final game, with the Italians still in contention to advance.

Today, co-host Ukraine plays France in Donetsk and England meets Sweden in Kiev in the second round of games in Group D.

In Gdansk, Torres scored twice in his return to the lineup after starting on the bench for the 1-1 draw with Italy as manager Vicente del Bosque elected to play the opening game without a recognized striker.

“You have to enjoy every moment,” Torres said on UEFA’s website. “I had the luck to start the match and score goals and enjoy it with the team.”

Spain Domination

Spain dominated with 66 percent of possession and had 26 shot attempts, 20 on target, compared to six for Ireland, which becomes the first team eliminated from the 16-team tournament.

“For the vast majority we were chasing shadows,” Irish midfielder Keith Andrews told ITV. “We just couldn’t get near them.”

Torres needed four minutes to put Spain in front as he picked up the loose ball after Richard Dunne’s tackle on Silva at the edge of the area, moved to his right and fired a shot by goalkeeper Shay Given.

Given also made saves against Silva, Andres Iniesta, Xavi Hernandez and Alvaro Arbeloa to keep the Irish within a goal at halftime.

Silva doubled the lead four minutes after the break as he got the rebound after Given saved Torres’s shot and slid a left- footed effort through three defenders into the net.

Torres added his second goal in the 70th minute as he took a pass from Silva between two defenders and slotted past Given. Fabregas replaced Torres in the 74th minute and closed the scoring nine minutes later by powering a shot past Given after a short corner kick.

Mandzukic’s Third

In Poznan, Mandzukic’s goal wiped out a first-half score from Andrea Pirlo. It was the striker’s third goal to tie Germany’s Mario Gomez and Russia’s Alan Dzagoev for the tournament lead.

“We can get through,” Italy coach Cesare Prandelli said on UEFA’s website. “We are mathematically still in it, but we have missed an opportunity here.”

Italy controlled play early as Mario Balotelli took a pass from Emanuele Giaccherini, turned near the penalty spot and shot wide of goal after three minutes. Claudio Marchisio fired over goal and Balotelli’s shot was punched away by Stipe Pletikosa.

Italy goalkeeper Gianluigi Buffon went down to grab Darijo Srna’s cross at the near post and also caught Ivan Perisic’s header.

Antonio Cassano and Balotelli shot wide and Pletikosa then made two saves off Marchisio after the midfielder turned Srna in the area. Italy took the lead in the 39th minute when Pirlo curled a free kick between Pletikosa and the near post.

Croatia started quickly in the second half as Luka Modric forced a save from Buffon in the opening minute, then sent a shot over goal. Balotelli also shot over from just outside the area after finding space.

Croatia drew even with 18 minutes remaining as Ivan Strinic lofted a cross from the left for Mandzukic, who knocked it down and fired a shot in off the right post.

To contact the reporter on this story: Bob Bensch in London at bbensch@bloomberg.net.

To contact the editor responsible for this story: Christopher Elser at celser@bloomberg.net.

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Central Banks Warn Greek-Led Euro Stress Threatens World

By Simon Kennedy - Jun 15, 2012 6:34 AM GMT+0700

Central banks intensified warnings that Europe’s failure to tame its debt crisis threatens to roil the world’s financial markets and economy as Greece’s election in two days looms as the next flashpoint for investors.

Monetary policy makers from the U.K. to Japan and Canada sounded the alert about potential fallout from the single currency bloc’s troubles. They spoke as Group of 20 leaders prepare to meet in Mexico next week amid the weakest international economy since the 2009 recession.

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A supporter of Alexis Tsipras, leader of Greece's Syriza party. international economy since the 2009 recession. A victory by Syriza, the party that promises to renege on Greece’s end of the bailout deal, could speed the nation’s exit from the euro. Photographer: Chris Ratcliffe/Bloomberg

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June 15 (Bloomberg) -- Eric Fishwick, head of economic research at CLSA Ltd., talks about the outlook for a solution to Europe's debt crisis, and its similarities with Asia's currency crisis more than a decade ago. He speaks with Rishaad Salamat on Bloomberg Television's "On the Move Asia." (Source: Bloomberg)

A victory by Syriza, the party that promises to renege on Greece’s end of the bailout deal, could speed the nation’s exit from the euro. Absent a quick fix from divided European governments, central bankers may have to engage in fresh crisis- fighting of their own to ensure markets operate and their economies grow if the election jolts investors. Spain’s 10-year bond yield vaulted above 7 percent yesterday in a fresh sign of the stress that has plagued the region for two years.

The crisis has created a “large black cloud of uncertainty hanging over not only the euro area, but our economy too, and indeed the world economy,” Bank of England Governor Mervyn King said in London late yesterday.

Canada faces a “major shock,” and global financial conditions could deteriorate significantly if Europe’s crisis worsens, the country’s central bank said yesterday. Bank of Japan (8301) Governor Masaaki Shirakawa said June 13 that the euro area poses the biggest challenge to the world’s No. 3 economy.

Sufficient Liquidity

“It will be very important for central banks over the next few weeks to articulate what their role is,” said Lawrence Goodman, president of the Center for Financial Stability in New York, a research group focused on financial markets. “The key goal will be to provide sufficient liquidity in the event of a freeze.”

U.S. stocks advanced after Reuters reported that central banks are prepared to coordinate actions if needed to boost liquidity in financial markets, citing officials linked to the G-20 nations. The Standard & Poor’s 500 Index added 1.1 percent to 1,329.10 at the close of trading in New York.

Central bankers have been at the forefront of efforts to insulate their economies from the financial crises that began to rage in August 2007. In October 2008, they cut interest rates in unison, and at the end of last year, six of them made it cheaper for banks to borrow dollars in emergencies. Dollar swap lines have been repeatedly augmented since the 2008 collapse of Lehman Brothers Holdings Inc.

Coordinated Response

Investors want global leaders to take action on reviving economic growth, Institute of International Finance Managing Director Charles Dallara said in a letter yesterday to the G-20. He said markets “will be looking expectantly for evidence of a globally coordinated policy response targeted to revive growth prospects.”

Europe’s turmoil this week forced Spain to ask for a bailout of its banks that may run as high as 100 billion euros ($126 billion), making it the fourth and largest euro-zone economy to seek aid. The record yield on Spanish bonds has fueled speculation the world’s 12th-biggest economy may need a full rescue.

Attention is turning to Greece, which votes a second time in six weeks after a May 6 ballot failed to yield a government. The Syriza party, led by Alexis Tsipras, is vying for first place in the opinion polls with a promise to abrogate the terms of the 240 billion-euro bailout from the European Commission, European Central Bank and International Monetary Fund. That’s drawn warnings that it could cost Greece the aid it needs and ultimately its place within the euro.

China’s Cut

Monetary policy makers are already leaning toward greater stimulus a week after China cut borrowing costs for the first time in four years. King said yesterday that more aid may be needed in the U.K., and a new plan to spur bank lending may be in place in a few weeks.

ECB President Mario Draghi last week left the door open for an interest-rate cut, while Federal Reserve Chairman Ben S. Bernanke says U.S. policy makers will discuss next week whether to do more to spur growth. Both have pointed to the limitations of repeated monetary support.

While the G-20 could consider coordinated monetary stimulus, it’s unlikely given neither the U.K. nor European central banks acted when they had a chance a week ago, Andrew Kenningham, an economist at Capital Economics Ltd. in London, said in a report yesterday.

Unlikely to Agree

“In fact, we think the central banks which matter most are unlikely to agree to further significant policy stimulus this year unless and until the crisis in the euro-zone deteriorates further,” he said.

G-20 governments are also indicating they will use the June 18-19 summit in Los Cabos, Mexico, to again demand Europe pursue fresh measures. It’s the fourth consecutive such meeting at which Europe’s strains have topped the agenda and comes seven months after talks in Cannes, France, were dominated by the prospect Greece could be forced from the euro.

Canadian Finance Minister James Flaherty said June 13 that “a disruptive moment” could occur if Greeks back anti-bailout parties, which may end up costing the country membership in the euro. U.S. Treasury Secretary Timothy F. Geithner said the same day that European leaders “recognize they’re going to have to do a bunch more.”

Less Incremental

“Countries outside of Europe have been consistent in calling for bolder, less incremental measures to stem the crisis,” said Daniel Price, who organized the first G-20 summit for President George W. Bush in 2008 and is now managing director of Rock Creek Global Advisors, a Washington-based consultancy. “They are losing patience with the apparent inability of Europe to implement reforms all recognize as necessary.”

Chancellor Angela Merkel, leader of Europe’s biggest economy, said yesterday Germany is willing to help resolve the regional strains though cannot tackle the global fallout alone.

Acknowledging that Germany, as “the engine of growth and anchor of stability in Europe,” will be asked to do more in Mexico, she said Germany would do so because “we are convinced that Europe is our destiny and our future.”

Merkel still rejected all “seemingly easy” solutions, such as issuing joint debt. European leaders are preparing for their own summit in Brussels this month aimed at devising ways to better integrate the euro area.

To contact the reporter on this story: Simon Kennedy in London at skennedy4@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net

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Asian Stocks, Commodities Gain on Stimulus Bets; Dollar Declines

By Glenys Sim and Jonathan Burgos - Jun 15, 2012 9:55 AM GMT+0700

Asian stocks rose, poised for its biggest weekly gain in five months, and commodities climbed for a second day on expectations that central banks may increase measures to boost economies as Europe’s debt crisis hurts growth. Credit risk in the region fell and the dollar declined.

The MSCI Asia Pacific Index added 0.5 percent at 10:50 a.m. in Hong Kong, where the Hang Seng Index rallied 1 percent. Standard & Poor’s 500 Index futures advanced 0.2 percent after the gauge surged 1.1 percent yesterday. The S&P GSCI index of commodities climbed 0.7 percent to the highest level in a week. Asian credit risk dropped for a fifth day in the longest run since March 19. The Dollar Index lost 0.2 percent.

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Mervyn King, governor of the Bank of England. Photographer: Chris Ratcliffe/Bloomberg

U.S. stocks were buoyed yesterday after jobless claims and inflation data supported the case for more stimulus by the Federal Reserve, which meets for two days from June 19. Data today may show U.S. industrial production slowed and consumer confidence fell. Greek elections on June 17 may determine if the country upholds austerity conditions attached to international aid, and could lead to the first ouster from the euro bloc.

“We’re likely to see increasing talk from governments about how they can encourage the growth agenda,” said Angus Gluskie, who helps manages more than $350 million at White Funds Management in Sydney. “There’s plenty of uncertainties out there. We may still see investors continue to be nervous about Spain and Italy in the aftermath of Greece’s election.”

Monetary policy makers from the U.K. to Japan and Canada stepped up warnings about the threat to world financial markets should Europe fail to contain its debt crisis. Bank of England Governor Mervyn King said the central bank will activate a sterling liquidity facility to aid banks, and plans to have a form of credit easing operating to boost lending as the case for looser policy “is growing.”

Oil Gains

Crude in New York climbed 0.7 percent to $84.53 a barrel, extending yesterday’s 1.6 percent jump as the Organization of Petroleum Exporting Countries kept its output quota unchanged amid calls for members to reduce production to comply with current targets. Copper futures advanced 0.9 percent in London, set for its first weekly increase in seven. Gold for immediate delivery added 0.1 percent in its sixth consecutive advance.

“It would appear the weaker U.S. dollar and rallying U.S. equity markets in response to speculation that global leaders would intervene after this weekend’s election in Greece, were supportive,” Mark Pervan, head of commodity research at Australia & New Zealand Banking Group Ltd., wrote in a note.

China, the biggest consumer of most commodities including steel and aluminum, can further cut its reserve requirement ratio as M2 growth is “relatively slow” this year, according to a report by researchers at the Chinese Academy of Social Sciences published in the People’s Daily.

Chinese Yuan

The People’s Bank of China raised its daily yuan fixing by 0.16 percent, the most since May 2, to 6.3089 per dollar today. That’s 0.97 percent stronger than yesterday’s closing spot in Shanghai and the currency is allowed to trade as much as 1 percent on either side of the fixing.

The yuan strengthened 0.07 percent to 6.3657 per dollar in Shanghai, heading for the first weekly gain in six weeks, according to the China Foreign Exchange Trade System.

Three stocks rose in the MSCI Asia Pacific Index (MXAP) for each one that fell. China Railway Group Ltd. (390) advanced 2 percent in Hong Kong after the Economic Information Daily said the Chinese government plans to build six coal transport railways. DeNA Co., Japan’s biggest social-gaming operator, surged 14 percent on a stock buy-back plan.

To contact the reporters on this story: Glenys Sim in Singapore at gsim4@bloomberg.net; Jonathan Burgos in Singapore at jburgos4@bloomberg.net

To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net

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Baidu to Share Revenue With Apple on China IPhone Deal

By Mark Lee - Jun 15, 2012 6:33 AM GMT+0700

Baidu Inc. (BIDU) said Apple Inc. (AAPL) will be entitled to a share of advertising sales after the Chinese company’s search engine was added as part of a software upgrade for iPhones in China.

The revenue-sharing agreement with Apple follows similar accords between Baidu and manufacturers of handsets that use Google Inc. (GOOG)’s Android operating system, Wang Jing, vice president at Beijing-based Baidu, said in a phone interview yesterday. He declined to disclose the commercial terms.

Apple said this week it will offer Baidu’s search engine as an option for iPhone and iPad customers and add Chinese-language support for its Siri voice technology, as the world’s most valuable company tailors its products for Chinese consumers. Baidu, which fields about 80 percent of China’s Web searches, is prepared to incur costs to add smartphone users by offering services such as music streaming for free, Wang said.

“Previously they were sharing revenue with websites to bring in search-engine traffic, and now they are sharing it with smartphone manufacturers,” said Eric Wen, who rates Baidu buy at Mirae Asset Securities in Hong Kong. He estimates Baidu distributes less than 10 percent of revenue generated from smartphones to device makers.

Baidu rose 0.8 percent to $117.64 at the close in New York. The stock has gained 1 percent this year, underperforming the 44 percent gain in the Hong Kong-traded shares of Tencent Holdings Ltd. (700), China’s biggest Internet company.

Carolyn Wu, a spokeswoman at Apple in Beijing, didn’t immediately return messages to her office and mobile phones seeking comment.

Focus on Smartphones

Baidu and Tencent both need to invest in their mobile Internet operations as more people in China access services on smartphones instead of computers, according to Mirae’s Wen.

Baidu is sharing advertising revenue with hardware partners to encourage them to install its search engine on their products before shipping. About 80 percent of branded phones based on the Android technology have Baidu preloaded, billionaire Chief Executive Officer Robin Li said in April.

Users of the new iOS 6 operating system that runs iPhones and iPads will have increased access to Chinese Internet services including Baidu, Sina Corp. (SINA)’s Weibo microblog, and online videos from Youku Inc., (YOKU) Apple said this week. The Cupertino, California-based company tripled its revenue in China last quarter, making the Asian country its biggest market outside the U.S.

Baidu introduced its “Cloud ROM” software for download by users of Android devices this month, giving them access to services including remote data storage and free music streaming.

“We are very willing to pay the costs, we are happy these services are free,” Wang said.

To contact the reporter on this story: Mark Lee in Hong Kong at wlee37@bloomberg.net

To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net

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Pelosi Joins Cantor Among Wealthiest U.S. House Leaders

By Heidi Przybyla - Jun 15, 2012 1:41 AM GMT+0700

House Minority Leader Nancy Pelosi and her Republican counterpart, Majority Leader Eric Cantor, are the wealthiest members of the U.S. House leadership, according to financial disclosure forms.

Pelosi, 72, of California tops the list of House leaders, with $40 million to $187 million in financial assets she reports with her husband, San Francisco commercial real estate investor Paul Pelosi. Most of their assets are listed as rental properties in California and partnership income in companies including investment management and restaurants.

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House Minority Leader Nancy Pelosi in the Capitol Visitor Center. Photographer: Tom Williams/CQ Roll Call/Getty Images

Cantor, 49, of Virginia listed financial assets including stocks and real estate holdings valued at almost $4 million to $9.6 million on his annual financial disclosure statement released today.

In the Senate, Minority Leader Mitch McConnell of Kentucky stands far above all his leadership counterparts, listing assets valued between at least $9.9 million and $44.5 million. Much of the wealth is held by his wife, Elaine Chao, who served as labor secretary throughout former President George W. Bush’s eight years in office.

Arizona Senator Jon Kyl, the chamber’s second-ranking Republican, reported assets between $467,000 and $1.08 million, with the bulk of it in individual retirement accounts.

Domino’s Pizza

Among Cantor’s biggest stock holdings is an investment of $500,000 to $1 million in Domino’s Pizza Inc. (DPZ) His wife, Diana, a former Goldman, Sachs & Co. (GS) vice president who is chairman of the board of the Virginia Retirement System, is a director of Domino’s Pizza and Media General Inc. (MEG), a Richmond-based newspaper and broadcast company.

The Cantors also own an Arlington, Virginia, condominium valued at between $500,001 and $1 million. He listed between $500,000 and $1 million in Bank of America bank accounts.

Maryland Democrat Steny Hoyer, the minority whip, is among the least wealthy House leaders.

He cited assets of $30,000 to $100,000. Hoyer reported he owes at least $100,000 and as much as $250,000 in a mortgage on his home in Mechanicsville, Maryland, to SunTrust Banks in Richmond.

Financial disclosure forms filed by members of Congress require lawmakers to state the value of holdings in broad ranges. Precise figures aren’t made public.

Mutual Funds

House Speaker John Boehner, an Ohio Republican who once owned a small business, listed unearned income of at least $10,116 and as much as $46,700 from mutual-fund dividends or capital-gains distributions.

Boehner listed assets valued between $1.8 million and $5.4 million. All of his stock and bond investments in companies including Intel Corp., Home Depot Inc., Honeywell International Inc., Pfizer Inc. and JPMorgan Chase & Co. (JPM) were through individual retirement accounts. He and his wife, Debbie, who works as a real estate agent, didn’t report a mortgage on their home near a golf course in suburban Cincinnati.

Pelosi, who yielded the speakership to Boehner after Republicans won control of the House, and her husband own a vineyard in St. Helena, California, valued between $5 million and $25 million.

Reid’s Assets

In the Senate, Majority Leader Harry Reid of Nevada is the wealthiest Democratic leader, listing assets between $2.78 million to $6.19 million, with much of his net worth in real estate holdings in his home state of Nevada and in Arizona. Reid, the son of a Nevada hard-rock miner, has holdings in bonds and stock mutual funds and other investments.

Patty Murray of Washington state, the fourth-ranking Senate Democrat and the only woman in the chamber’s leadership, listed assets between $564,000 and $1.5 million. Senator Charles Schumer of New York, the chamber’s third-ranking Democrat, listed assets of $320,000 to $950,000.

About 20 percent of U.S. House members applied for filing extensions this year.

Members of Congress are required to report details of mortgages on their personal residences for the first time this year, a provision included as part of a congressional ethics law. While the Senate required members to list the terms of their mortgage -- including interest rates, length and points used to pay down their rates -- the House didn’t.

Mortgage Rates

Among lawmakers paying the highest home-mortgage interest rates is Schumer, who has a 15-year mortgage taken out in 2002 at 6.85 percent.

House Financial Services Committee Chairman Spencer Bachus, an Alabama Republican who will preside over a hearing on JPMorgan next week, has 2 mortgages with the bank, according to federal disclosure documents. JPMorgan chief executive Jamie Dimon is scheduled to testify before the committee on June 19.

Senate Democrat Jay Rockefeller of West Virginia reported among the best interest rates on a 1998 loan from the United National Bank of Charleston. It is listed as New York Prime minus 1 percent. As of June 13, the prime rate was 3.25 percent.

Today’s filings also show what gifts lawmakers have received. Representative Gary Ackerman, a New York Democrat, acknowledged exceeding legal limits. Ackerman, who is retiring at the end of the year, accepted a “priceless” gift, according to his personal financial disclosure form. What did the Long Islander get?

“The blessed opportunity for 30 years to pay back, in some small measure, the good things that happened to me.” And who gave it to him? “The people,” his form said.

To contact the reporters on this story: Heidi Przybyla in Washington at hprzybyla@bloomberg.net

To contact the editor responsible for this story: Jodi Schneider in Washington at jschneider50@bloomberg.net.

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U.S. Stocks Rise on Reports Policy Makers May Take Action

By Inyoung Hwang - Jun 15, 2012 4:36 AM GMT+0700

U.S. stocks advanced, erasing a weekly loss for the Standard & Poor’s 500 Index, amid reports policy makers may take steps to assist economies battered by Europe’s sovereign debt crisis.

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Traders work at the New York Stock Exchange (NYSE) in New York. Photographer: Scott Eells/Bloomberg

All 10 groups in the S&P 500 rose, led by telephone service providers. Home Depot Inc. and Walt Disney Co. added at least 2.1 percent after data on inflation and jobless claims fueled bets the Federal Reserve will act to spur growth. Exxon Mobil Corp. (XOM), the largest energy producer by market value, increased 1.9 percent as oil rallied. Travelers Cos. and Bank of America Corp. (BAC) gained at least 2.1 percent as financial companies jumped.

The S&P 500 gained 1.1 percent to 1,329.10 at 4 p.m. in New York. The benchmark index for American equities is up 0.3 percent for the week. The Dow Jones Industrial Average rose 155.53 points, or 1.2 percent, to 12,651.91 today. Trading volume for exchange-listed stocks in the U.S. was about 6.6 billion shares, 2.5 percent below the three-month average.

“It’s a sign that they’re talking and that’s good,” Rod Smyth, the Richmond, Virginia-based chief investment strategist of Riverfront Investment Group, which manages $3 billion, said in a telephone interview. “Equity investors are poised with the knowledge that if European policy makers can figure out a way to stem the vicious cycle that’s been building, then stocks look really cheap and bonds look expensive.”

The S&P 500 tumbled as much a 9.9 percent from a four-year high in April through June 1 amid lower-than-forecast economic data and concern Europe’s debt crisis was spreading. The index has rebounded 4 percent since, and trades at 13.4 times its companies’ reported earnings, below the average of 16.4 since 1954, according to data compiled by Bloomberg. The S&P 500 fell yesterday as borrowing costs rose in Italy and Germany before elections in Greece on June 17 that may determine whether the Mediterranean nation will leave the euro area.

Central Banks

Stocks extended gains today amid reports of plans by central banks. Bloomberg News reported that U.K. Chancellor of the Exchequer George Osborne and Bank of England Governor Mervyn King are preparing two programs to increase the flow of credit. Reuters said that central banks are prepared to take action if needed to boost liquidity in financial markets if the Greek elections cause tumultuous trading, citing officials linked to the Group of 20 nations.

Speculation grew that the Federal Reserve will discuss stimulus efforts at its meeting next week after reports showed jobless claims unexpectedly climbed by 6,000 to 386,000 last week and the cost of living fell by the most in more than three years.

‘Good Stage’

“Good inflation data and weak employment is a good stage for a Fed policy response,” Kevin Shacknofsky, who helps manage about $5 billion for Alpine Mutual Funds in Purchase, New York, said in an e-mail. “We are at the stage where bad news is good news in terms of a policy response. Jobs will be the critical factor that influences the Fed.”

Home Depot (HD), the largest U.S. home-improvement retailer, climbed 2.3 percent to $52.16 and Disney, the world’s largest entertainment company, advanced 2.1 percent to $47.18. Exxon Mobil increased 1.9 percent to $82.13 and Cabot Oil & Gas Corp. (COG) jumped 8.6 percent to $35.04 as energy shares in the S&P 500 gained 1.7 percent as a group.

Travelers added 2.4 percent to $63.12, the biggest gain in the Dow, while Bank of America, the second-biggest U.S. lender, climbed 2.1 percent to $7.66 as financial stocks rallied 1.3 percent.

Telephone companies jumped 1.9 percent as a group. Consumer discretionary stocks, which include retailers, hotel chains and restaurant companies, climbed 1.4 percent. An S&P index of homebuilders advanced 4.1 percent, as Lennar Corp. (LEN) increased 3.6 percent to $25.55 and PulteGroup Inc. (PHM) added 5.2 percent to $8.85.

Casino Machines

International Game Technology (IGT) rose 14 percent, the most in the S&P 500, to $15.12. The maker of casino machines announced a share buyback plan of as much as $1 billion in an effort to reward investors after a 23 percent stock drop this year.

Kroger Co. (KR) climbed 6.1 percent to $22.58. The largest U.S. grocery-store chain said profit for the year ending Jan. 31 will be as much as $2.40 a share, up from a prior forecast of as much as $2.38. Kroger also said its board approved a new $1 billion share buyback program, replacing an authorization that was exhausted on June 12.

Family Dollar Stores Inc. (FDO) advanced 4 percent to a record $72.85. The discount retailer was raised to buy from neutral at Cleveland Research Co. on expectation new merchandising is driving up sales.

Edwards Lifesciences Corp. (EW) rose 7 percent to $96.88 for the third-biggest advance in the S&P 500. The company won the backing of U.S. advisers for an expanded use of its Sapien heart valve as an alternative to open-heart surgery.

Fed Meeting

The Fed, which will gather two days after the Greek election, has identified the country’s exit from the euro as an outcome that would deepen the crisis and threaten the U.S. expansion. The central banks bought $2.3 trillion of bonds in two rounds of so-called quantitative easing from 2008 through 2011 to stimulate growth through lower borrowing costs.

Chairman Ben S. Bernanke told lawmakers last week the “central question” confronting the Fed at its June 19-20 meeting is whether growth is fast enough to make “material progress” reducing unemployment. Fed officials, including Vice Chairman Janet Yellen, have said there’s scope for further easing at some point to reduce a jobless rate persisting above 8 percent.

“We’re still on the fence right now whether there is going to be another round of quantitative easing,” Michael Mullaney, who helps manage $9.5 billion as chief investment officer at Fiduciary Trust in Boston, said in a phone interview. “We’re going to be cautious for the foreseeable future. There’s so many banana peels on the floor right now you can slip on any one of them at any time.”

To contact the reporter on this story: Inyoung Hwang in New York at ihwang7@bloomberg.net

To contact the editor responsible for this story: Nick Baker at nbaker7@bloomberg.net

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