Stocks rise as stimulus bets spur $4.1 trillion gain; oil climbs

NEW YORK – U.S. shares joined equity gains in European and Asian, extending a rally that’s added $4.1 trillion to global equities this month, as a run of weaker-than-estimated economic reports from China, Europe and the United States boosted speculation central banks will maintain stimulus measures.

Energy stocks led gains in Europe as oil rebounded after a four-day decline. The Standard & Poor’s 500 Index headed for a third weekly advance. The Shanghai Composite Index had its best week in four months on optimism China will accelerate reforms of state-owned companies. The dollar regained ground, damping emerging-market currencies.

Weak economic news has proved positive for equities this month as traders speculate ongoing global uncertainty will stay the Federal Reserve’s hand until 2016 and that policy makers from Europe to Asia will keep or increase monetary stimulus. U.S. factory output fell in September for a second month. A Chinese stocks have rallied as the government unveiled further reforms of state-run industries.

“You may have no rate hike this year from the Federal Reserve and an extension of stimulus in Europe and in Japan, so that’s giving a boost to equities,” said John Plassard, a senior-equity sales trader at Mirabaud Securities in Geneva. “At the same time, crude rebounded, and earnings in the U.S. and Europe were not so bad.”

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Stocks

The S&P 500 added 0.2 percent at 9:31 a.m. in New York, headed for its longest streak of weekly gains since May. The gauge has rallied 8.4 percent from the low during an August selloff.

Wynn Resorts Ltd. tumbled after reporting revenue that trailed analysts’ estimates following a drop in gambling in Macau. Las Vegas Sands Corp. also declined. General Electric Co. was little changed after profit beat estimates while sales fell short of projections.

Data showed a drop in factory output as high inventories and lukewarm demand from overseas customers kept American producers bogged down. A surge in the dollar since mid-2014 has made U.S. products more expensive in foreign markets at the same time the oil industry cuts back and companies contend with bloated stockpiles.

The Stoxx Europe 600 Index advanced 0.6 percent after gaining as much as 1 percent. Glencore PLC climbed 1.4 percent as BlackRock Inc. increased its position on the miner. Carrefour SA rose 6.5 percent after the French grocer reported a gain in third-quarter revenue.

Emerging markets

The MSCI Emerging Markets Index added 0.2 percent, leaving it 0.9 percent higher in its third weekly increase, the longest run of gains in five months. The Malaysian ringgit slid from an eight-week high versus the dollar, leading currencies lower.

The Hang Seng China Enterprises Index advanced 0.8 percent in Hong Kong, taking its rise since the end of September to 13 percent. The Shanghai gauge increased 1.6 percent Friday, extending the weekly gain to 6.5 percent. Friday’s trading volumes were 34 percent higher than the 30-day average and margin debt advanced for a sixth day on Thursday, signs the market was luring back investors.

The Shanghai Composite has risen 16 percent from an August low amid speculation that policy makers will introduce more measures to boost growth after a rout in equities that erased almost $5 trillion of market value. Data released this week showed consumer prices rose at a slower pace in September, leaving more room to ease monetary policy.

The ringgit fell 1.4 percent and Brazil’s real lost 1 percent. A gauge of 20 developing-nation currencies slid 0.4 percent.

Turkey’s lira slid 0.5 percent, after falling as much as 1.1 percent. The military said it shot down an aircraft on the Syrian border Friday as the state-run news agency released images of a damaged unmanned drone at the suspected crash site. The nationality of the craft is unknown, according to the military.

Russia’s ruble declined 0.7 percent.

Commodities

West Texas Intermediate crude rose 2.3 percent to $47.43 a barrel, trimming its slide in the week to 4.4 percent, still the most since August. Brent for December settlement gained 1 percent Friday to $50.20.

Oil has tumbled as U.S. stockpiles swelled. Inventories rose by the most in six months in data released this week, keeping inventories above the five-year seasonal average.

Most metals declined Friday. China, the world’s biggest consumer of industrial metals and the epicenter of last quarter’s market gyrations, reported an increase in aggregate financing to 1.3 trillion yuan ($205 billion), ahead of the 1.2 trillion yuan median estimate of economists. The data, released late Thursday, suggests increased infrastructure spending from the government and five rate cuts since November are helping boost loan demand.

Gold for immediate delivery was little changed at $1,182.45 an ounce, leaving its 2.3 percent higher on the week. Bullion touched its highest level since June on Thursday as prospects for U.S. rates staying near zero for longer boosted demand.

Currencies

The Bloomberg Dollar Spot Index, a gauge of the U.S. currency against 10 major peers, climbed 0.2 percent in a second day of gains, paring its drop in the week to 0.4 percent.

The euro slid 0.2 percent to $1.136, while the yen fell 0.2 percent to 119.10 per dollar, paring its weekly gain to 1 percent.

The Australian dollar led a pullback in major currencies versus the greenback, slipping 0.8 percent. New Zealand’s dollar retreated from a more than three-month high, losing 0.8 percent to 67.99 U.S. cents.

Bonds

European bonds advanced, with Spanish, Italian and German securities extending weekly gains. The region’s central bank is due to meet next week amid speculation it may expand its stimulus measures to support the economy.

The yield on German 10-year bonds was at 0.54 percent, down from 0.62 percent at the end of last week, while the yield on similar-maturity Spanish bonds slid five basis points to 1.76 percent.

The yield on U.S. 10-year Treasuries fell one basis point to 2.01 percent, down eight basis points from Oct. 9.

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