Stocks advanced as U.S. equity markets resumed trading for the first time this week after Hurricane Sandy. Most European shares rose as airlines reported better-than-estimate earnings, the euro strengthened and gasoline climbed to a two-week high.
The Standard & Poor’s 500 Index increased 0.5 percent at 9:50 a.m. in New York. The Stoxx Europe 600 Index added less than 0.1 percent, paring gains of as much as 0.5 percent. Air France-KLM Group and Deutsche Lufthansa AG, Europe’s two biggest carriers, rallied more than 6 percent. The euro appreciated against 13 of its 16 major peers, while Norway’s krone rallied after the central bank said it won’t buy foreign currency for the oil fund in November. The yield on 10-year Treasuries was little changed 1.72 percent. Gasoline jumped 4.5 percent.
U.S. stock markets and many government offices planned to open today after the biggest Atlantic storm in history caused flooding and blackouts along its 900-mile wide swath. Business activity in the U.S. contracted in October for a second month, according to a report today, following data yesterday that showed home prices rose by the most in two years. In Europe, finance chiefs are discussing ways of trying to put Greece’s bailout plan on track.
“Investors are braced for an exceptionally busy open, as three days of trading are combined into one” in the U.S., Richard Hunter, head of equities at Hargreaves Lansdown Plc in London, wrote in an e-mail. “There is the additional feature of some likely window-dressing business, given today being the last trading day of the month and the end of the year for many mutual funds. There has been some encouraging economic data in the form of prices data.”
Today’s advance trimmed this month’s decline in the S&P 500 to 1.6 percent. Internet and mobile-phone connections were limited on the floor of the New York Stock.
Sandy may reduce economic output by $25 billion in the fourth quarter, according to Gregory Daco, a U.S. economist at IHS Global Insight in Lexington, Massachusetts. That may lower the fourth quarter pace of growth to between 1 percent and 1.5 percent, from an estimate of 1.6 percent, he said.
“International markets have concluded that Sandy’s effects on the U.S. economy may be less than feared, and the focus has swiftly shifted back to the search for yield,” said Kit Juckes, head of foreign exchange research at Societe Generale SA in London. “Many are afraid of getting left behind.”
Apple Inc. declined 2 percent after Chief Executive Officer Tim Cook embarked on a sweeping management overhaul at the world’s most valuable company.
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