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Business Title: Stocks Rise, Treasuries Decline as Manufacturing Reports Boost Confidence Sept. 1 (Bloomberg) -- Global stocks surged the most since May, Treasuries tumbled and copper rallied as manufacturing in the U.S. and China grew faster than economists estimated. The dollar, yen and Swiss franc weakened. The MSCI World Index climbed 2.8 percent at 10:56 a.m. in New York, its best gain since May 27, and the Standard & Poor’s 500 Index jumped the same amount. Ten-year Treasury yields rose 12 basis points to 2.6 percent. Copper and nickel advanced more than 2 percent to pace gains in metals. The Australian dollar strengthened against all but one of its 16 major counterparts after the nation’s economic growth topped forecasts. Equities rebounded from the biggest August plunge in nine years as the expansion in manufacturing tempered concern that the global economy will slow as governments withdraw stimulus measures. Some Federal Reserve policy makers saw greater risks to the recovery yet the central bank signaled it’s hesitant to undertake another round of debt purchases to boost growth, according to minutes of an August meeting released yesterday. “It’s a combination of better industrial data out of China and the ISM data here in the United States,” said Mark Bronzo, an Irvington, New York-based fund manager at Security Global Investors, which oversees $21 billion. “People have become extremely negative and as a result the data was better than expected and you’re seeing a sharp snap back.” Indexes of industrial and energy companies rose at least 3.4 percent for the top gains among 10 groups in the S&P 500, all of which advanced. The benchmark for U.S. stocks slumped 4.7 percent in August as the economic rebound slowed. Bank of America Corp., Caterpillar Inc. and General Electric Co. led an advance in all 30 Dow Jones Industrial Average stocks. ISM Manufacturing Stocks extended gains after the Institute for Supply Management’s gauge of manufacturing unexpectedly rose to 56.3 in August from 55.5 a month earlier. Readings greater than 50 signal growth. Economists forecast the index would decline to 52.8, according to the median estimate in a Bloomberg survey. “The data tips the scale away from a recessionary outcome,” Myles Zyblock, the Toronto-based chief institutional strategist at Royal Bank of Canada, wrote in a note to clients today. “The ISM release is also a first step in the right direction for adding portfolio risk.” China’s purchasing managers’ index rose to 51.7 from 51.2, exceeding forecasts, while Australia’s economy expanded 1.2 percent from the first quarter, according to government data released today. Jobs Concern U.S. equities rallied even after companies unexpectedly cut 10,000 jobs last month, according to figures today from ADP Employer Services. The median estimate of 35 economists surveyed by Bloomberg News called for a gain of 15,000. Economists on average forecast government data on Sept. 3 will show that private payrolls rose by 41,000 last month after a 71,000 July gain, while the unemployment rate increased to 9.6 percent. A benchmark indicator of corporate credit risk in the U.S. fell for the first time this week. Credit-default swaps on the Markit CDX North America Investment Grade Index, which investors use to hedge against losses on corporate debt or to speculate on creditworthiness, declined 4.4 basis points to a mid-price of 110.15 basis points, according to index administrator Markit Group Ltd. The Stoxx Europe 600 Index rose 2.4 percent as almost 22 shares advanced for every one that fell. Mining companies Xstrata Plc and Rio Tinto Plc increased more than 5 percent. Vivendi SA, owner of the world’s largest record company, rallied 4.6 percent after raising its profit forecast. Vinci SA, the world’s biggest builder, jumped 4.2 percent as earnings beat estimates. ‘Need to Be Selective’ The MSCI Asia Pacific Index gained 1.5 percent and the MSCI Emerging Markets Index of 21 developing countries added 1.8 percent. Benchmark indexes in Australia, Japan, South Korea, India, South Africa, Indonesia and Egypt rose more than 1 percent. “Asian growth is still much better than the rest of the world,” said Manpreet Gill, a Singapore-based strategist at Barclays Wealth, which has $229 billion in assets. “Investors still need to be selective when buying equities as the global economic picture still looks tentative.” The Swiss franc depreciated 1.2 percent to 1.3029 per euro. Higher-yielding currencies rose against the dollar and the yen, with the Australian dollar climbing 2 percent to 90.85 U.S. cents. The euro was 1.1 percent higher at $1.2817. China’s manufacturing growth boosted raw materials prices, with the S&P GSCI Total Return index of 24 commodities rising 2 percent, the first increase this week and its largest in a month. Crude oil for October delivery climbed 2.7 percent to $73.83 a barrel on the New York Mercantile Exchange.
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#1. To: Brian S (#0)
Boost Confidence? rotflmao. You Lefties are hilarious.
Obama's first all-by-his-lonesome budget, btw, calls for a $1.17 trillion deficit.
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