German Chancellor, Angela Merkel
(Bloomberg)
European stocks fluctuated between advances and declines after the benchmark Stoxx Europe 600 Index completed its longest stretch of weekly gains in more than two years. U.S. index futures fell while Asian shares rose.
SEB (SEBA) AB, the Swedish bank that’s the second-largest lender in the Baltic countries, soared 6.7 percent after earnings topped estimates. G4S Plc (GFS) sank 7 percent as the world’s largest security company said it may incur a 50 million-pound ($78 million) loss after failing to provide enough guards for the Olympic Games.
The Stoxx 600 (SXXP) rose less than 0.1 percent to 256.31 at 9:04 a.m. in London. The gauge has climbed for six straight weeks, rallying 9.4 percent from this year’s low on June 4, as the European Central Bank and People’s Bank of China cut their benchmark interest rates and euro-area leaders eased repayment rules for Spanish banks and conditions for possible Italian aid, according to Bloomberg.
“Investors have remained very underweight,” Robert Parker, senior adviser at Credit Suisse Asset Management in London, said in a Bloomberg Television interview. “The earnings season will run another month and expectations are so negative that the downside risk is low.”
Standard & Poor’s 500 Index futures lost 0.2 percent today, while the MSCI Asia Pacific Excluding Japan Index added 0.3 percent. Japan’s stock market is closed for a holiday.
Asian stocks advanced after Premier Wen Jiabao said China will increase measures to support the world’s second-largest economy. The government will step up policy fine-tuning in the second half of the year to spur growth, the official Xinhua News Agency reported him as saying yesterday, reiterating comments Wen made during a visit to eastern Jiangsu province earlier this month.
Retail sales in the U.S. probably rose in June for the first time in three months as a gain in automobile demand outweighed spending on other goods, economists said before a report at 8:30 a.m. Washington time. The projected 0.2 percent advance would follow a 0.2 percent May drop, according to the median forecast of 72 economists surveyed by Bloomberg.
Also today, data from the Federal Reserve Bank of New York is projected to show factories in its region expanded at a faster pace in July. A 10 a.m. report from the Commerce Department may show inventories at U.S. businesses increased.
German Chancellor Angela Merkel said yesterday she hadn’t softened her stance at last month’s summit in Brussels and that a so-called banking union involving a bloc-wide financial overseer will have to include joint oversight on a “new level.”
German lawmakers will interrupt their summer vacations and return to Berlin on July 19 to vote to approve 100 billion euros ($122 billion) in rescue loans to Spain. Euro-area finance ministers will confer on July 20 to complete an agreement on Spain’s bank bailout.
JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon told analysts Europe is moving toward solving its financial crisis, while billionaire Warren Buffett said the region’s common currency is doomed to fail without an overhaul in how it works.
“You see progress, you know, two steps forward, one step back,” Dimon said in a July 13 meeting in New York. Buffett, speaking contemporaneously in a Bloomberg Television interview from Sun Valley, Idaho, said European leaders face “major problems” and the 17-country euro area may not survive.