European markets are called to open flat this morning.
Asian stocks rose, with the region’s benchmark index set for its biggest jump in five weeks, as a rally in commodities helped ease concern the global economic recovery is slowing. The euro gained versus the dollar and yen.
The MSCI Asia Pacific Index increased 1.6 percent at 3 p.m. in Tokyo, with three shares advancing for every one that fell. Futures on the Standard & Poor’s 500 Index added 0.4 percent, while those on the Euro Stoxx 50 Index rose 0.4 percent. Oil reached a two-week high, copper climbed for a third day and wheat added 1.3 percent. Treasuries declined for a second day. The euro gained 0.7 percent to $1.4180 and South Korea’s won surged 1.2 percent to 1,088.40 per dollar.
Raw material producers advanced after Deutsche Bank AG said copper will probably climb, joining Goldman Sachs Group Inc. in predicting higher commodity prices. Data today showed Korea’s consumer confidence rose to a three-month high, while a report is forecast to show the U.S. economy expanded faster than initially estimated. sian investors bought 16 percent of a 4.75 billion euro ($6.7 billion) sale of bonds by the European Union to help bail out Ireland and Portugal yesterday.
“Rebounding commodity prices indicate that demand is still there and signify to investors that the lobal economy is still in good shape,” said Dai Ming, a fund manager at Shanghai Kingsun Investment Management & Consulting Co. “Stocks are a bit oversold and valuations are low.”
All 10 industry groups on MSCI’s Asia Pacific index advanced, helping the gauge rebound from its owest level since March 21. South Korea’s Kospi index (KOSPI) rallied 2.8 percent after Citigroup Inc. and Credit Suisse Group AG predicted the gauge will rebound from recent losses. Japan’s Nikkei 225 Stock Average rose 1.5 percent while the S&P/ASX 200 Index jumped 1.5 percent in Australia.
U.S. stocks strengthened Wednesday, moving higher after three straight days of declines, following a rise in commodity prices.
The Dow Jones industrial average (INDU) added 38 points, or 0.3%. Caterpillar (CAT, Fortune 500) and DuPont (DD,Fortune 500) gained the most on the blue chip ndex, while Verizon (VZ, Fortune 500) and Kraft (KFT, Fortune 500) were the biggest laggards.
The S&P 500 (SPX) added 4 points, or 0.3%, while tech-heavy Nasdaq (COMP) rose 15 points, or 0.6%,with Netflix (NFLX) leading the advance.
The push higher came as gains in commodities “helped the market overcome negative economic news,” said Scott Marcouiller, chief technical market strategist at Wells Fargo Advisors.
Oil prices surged 1.7% to top $101 per barrel, while silver prices jumped more than 4% to near $38 per ounce. Gold prices edged up 0.2% to $1,526.70 per ounce.
Marcouiller said concerns about the European debt crisis also eased some after Fitch Ratings said that German banks’ risk from Greek debt is manageable.
Despite the day’ modest advance in stock prices, stocks remain lower for the month, and headwinds remain.
The Dow and S&P 500 have both declined more than 3%, and the Nasdaq has tumbled nearly 4% since the start of the month
“The market is in a bit of a tug-of-war,” said Mark Luschini, chief investment strategist at Janney Montgomery Scott.
On one hand, investors are on edge as they face a series of issues that refuse to go away: a slowing U.S. recovery, European debt problems, and the end of the Federal Reserve’ bond-buying program.
“The weak economic data is accumulating, and investors are spooked that the economy may be losing momentum, which could crimp future corporate profits,” Luschini said. “And nobody knows what the loss of the Fed’ stimulus in June will mean.”
On the other hand, corporate earnings have been coming in above expectations for the most part. And in a low-interest rate environment, equities remain the most attractive asset class, Luschini said.
Events this week
Thursday: Wall Street will get a second reading on the U.S.’ first-quarter gross domestic product. Economists expect economic growth to be revised to 2%, up from the initial estimate of 1.8%.
The weekly report on people filing for initial jobless claims is also due in the morning. Claims are expected to have fallen to 400,000 in the latest week, from 409,000 the previous week.
Also on tap: quarterly financial results from Tiffany & Co. and Sony.
Friday: Before the start of trading, investors will get data on personal income and spending for April. Economists expect income edged up 0.4% last month, while spending increased 0.5%.
Shortly after the opening bell, the University of Michigan will put out its final reading on consumer sentiment in May. Economists
expect the figure to remain unchanged at 72.4.
National Association of Realtors is expected to show a 1.8% decline in pending home sales for the month of March.