Bloomberg News

Japan Stock Futures Gain as S&P 500 Rises on Consumer Confidence

March 25, 2014

Russia's Ruble Climbs

Russian 100 ruble denomination banknotes photographed at the OAO Sberbank headquarters in Moscow. Photographer: Andrey Rudakov/Bloomberg

Japanese stock futures rose, after U.S. equities advanced for the first time in three days amid an unexpected increase in consumer confidence. The yen was little changed against the dollar.

Futures on the Nikkei 225 Index added 0.5 percent in Chicago. The yen fell less than 0.1 percent to 102.28 per dollar as of 6:53 a.m. in Tokyo. The Standard & Poor’s 500 Index (SPX) added 0.4 percent to 1,865.62. The Stoxx Europe 600 Index climbed 1.3 percent after falling 1.1 percent the previous day, the most in two weeks. Ten-year Treasury yields increased 2 basis points to 2.75 percent. Copper jumped 2 percent on speculation demand will improve as China takes steps to bolster economic growth.

An index of U.S. consumer confidence rose in March to the highest level in six years, overshadowing a separate report showing a drop in February home sales. German business confidence fell for the first time in five months. The world’s top industrial powers threatened further sanctions to deter Russian President Vladimir Putin from taking over other parts of Ukraine and suspended Russia from participating in the Group of Eight.

“The U.S. economy seemed to have cooled off from the pace it’s on toward the end of last year,” Curtis Holden, a senior investment officer at Tanglewood Wealth Management in Houston, said in a phone interview. His firm oversees about $800 million. “There may be a little relief recently that things may be stable here. Things don’t look spectacular here, but they look OK. The market is trying to piece together about how concerned should we be about things going on overseas.”

Harsh Winter

The S&P 500 slid March 24 as economic data signaled a slowdown in American manufacturing and biotechnology shares slumped. The benchmark index reached an intraday record on March 21 as data indicated the economy is pulling out of a slowdown linked to unusually harsh winter weather.

Three rounds of bond purchases from the Federal Reserve have helped fuel economic growth, sending the S&P 500 surging as much as 178 percent from its 2009 low. Fed Chair Janet Yellen said on March 19 that the central bank’s stimulus program could end this fall and benchmark interest rates may rise about six months later.

The Conference Board’s index of U.S. consumer confidence rose to 82.3 in March from 78.3 a month earlier, the New York-based private research group said. The median forecast in a Bloomberg survey of 76 economists called for a reading of 78.5 this month. Consumer spending accounts for about 70 percent of activity in the world’s largest economy.

Housing Data

Another report showed purchases of new homes in the U.S. fell in February to the lowest level in five months, a sign the industry may take time to pick up after inclement weather damped demand earlier in the year.

Residential real-estate prices climbed at a slower pace in the year through January than a month earlier, according to the S&P/Case-Shiller index of property values in 20 cities.

The Stoxx 600 advanced after losing 1.1 percent the previous day, the most since March 7. The index is up 0.1 percent for this year.

Meeting for the first time since last week’s annexation of Crimea by Russia, Group of Seven leaders said they won’t attend a planned G-8 meeting which was to have been held in Sochi, site of the Winter Olympics, and will instead hold their own summit in June in Brussels.

Both sides in Ukraine’s crisis spent the day calculating what to do next, with Russia consolidating its control over Crimea and maintaining forces along the border with Ukraine in the most serious confrontation between Moscow and the U.S. and its allies since the demise of the Soviet Union.

Copper Rallies

Moscow’s Micex Index increased 2 percent.

The MSCI All-Country World Index gained 0.6 percent after four consecutive days of declines.

The euro weakened against all but three of its 16 major peers as below-forecast European business data fueled speculation that the region’s economy may struggle further to recover.

Copper climbed 2 percent to help lead gains in 16 of 24 commodities tracked by the S&P GSCI Index. China will accelerate public spending and loosen regulations on private investment, Li Daokui, former adviser to the People’s Bank of China, said in Bloomberg Television interview.

Demand is starting to emerge from industries including construction and power, and some fabricators are considering buying more copper due to increased orders and lower prices, according to a survey by Macquarie Group Ltd. China is the biggest buyer of the metal.

Futures also rose as Anglo American Plc stopped work at its largest copper mine in Chile, the world’s biggest producer, after protests by contract workers turned violent.

To contact the reporters on this story: Lu Wang in New York at lwang8@bloomberg.net; Claudia Carpenter in London at ccarpenter2@bloomberg.net

To contact the editors responsible for this story: Stuart Wallace at swallace6@bloomberg.net; Lynn Thomasson at lthomasson@bloomberg.net Jeff Sutherland, Michael P. Regan


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