European Stocks Advance; Asia Shares Score Three-year High

02 July 2014 10:04:00 AM

By: DailyForex.com

European stocks advanced for a second day, following yesterday’s biggest gain in almost two months, as investors awaited reports on U.S. jobs and factory orders. U.S. index futures were little changed, while Asian shares rallied.

The Stoxx Europe 600 Index climbed 0.3 percent to 345.79 at 9:06 a.m. in London. The gauge rose 0.9 percent, the most since May 8, as data showed manufacturing expanded in China and the euro area. It gained 2.3 percent in the second quarter, capping the longest stretch of quarterly advances since March 2010.

In the U.S., data from the ADP Research Institute showed companies hiring 205,000 employees in June, compared with an increase of 179,000 the previous month. The private report precedes the Labor Department’s payrolls data tomorrow. Strong buying was seen in the autos sector after industry data was released with U.S. auto sales almost reaching an annualized 17 million in June, way above forecasts and the strongest since 2006.

The Dow and S&P 500 both hit record closing highs on Tuesday, with the Dow gaining 0.77 percent and the S&P 500 0.67 percent; the Nasdaq put on 1.14 percent. Futures on the Standard & Poor’s 500 Index rose 0.1 percent.

Dealers said fund managers were rotating money out of bonds and into equities for the start of the second half of the year, nudging up U.S. Treasury yields.

In Asia, the MSCI Asia Pacific Index added 0.9 percent to extend a six-year high. Asian stocks scored a three-year peak on Wednesday in the wake of upbeat global economic data that whetted risk appetites and helped Wall Street taste all-time highs.

Currencies

The sterling was up at $1.7150 after bullish UK data sent it as far as $1.7167 on Tuesday, its highest since October 2008. Not far behind was South Korea's won, which hit its highest in six years at 1,009.3 per dollar.

The U.S. dollar was dull, in contrast, making only slight gains on both the euro and yen. Its currency basket index inched up to 79.833 from a two-month trough of 79.740.

The Australian dollar was knocked off an eight-month peak when data showed the country's trade deficit widened by far more than expected in May, leaving it at $0.9455.

Commodities

Gold eased back a touch to $1,325.50 an ounce having hit a 2-1/2-month high of $1,332.10 on Tuesday and Brent crude lost 12 cents to $112.17 a barrel, while U.S. crude was quoted 5 cents firmer at $105.39.

Cina Coren is a former Wall Street broker and financial advisor. She holds a Master's degree in Communications and spent many years writing for international news outlets and journalistic publications. Today, Cina spends most of her time writing internet articles and blogs, and reading various newspapers to stay on top of the news.

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