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March 12 (Bloomberg) — Stocks rose as commodity companies and banks drove the MSCI Emerging Markets Index to its fifth week of gains. Gold led commodities higher, while the yen weakened.

The emerging-markets gauge rose 0.4 percent at 10:50 a.m. in London, heading for its longest winning streak since May. Futures on the S&P 500 added 0.2 percent, after the benchmark index for U.S. equities yesterday hit a 17-month high, while the MSCI World Index climbed 0.6 percent. The yen fell against 11 of its 16 most-traded counterparts. Gold rose for a second day and nickel climbed for the first time in five days.

Emerging-market and high-yield bond funds each took in more than $1 billion in the week to March 10, according to EPFR Global, a Cambridge, Massachusetts-based research company. European industrial output rose the most in more than two decades in January, signaling the recovery may be strengthening. Japanese Finance Minister Naoto Kan said intervention is an “option” when “markets move too abruptly.”

“This is a continuation of the improvement in risk appetite,” said Henrik Degrer, a fund manager at Svenska Handelsbanken in Stockholm, which oversees $36 billion. “The Greek issue seems to be contained, so now we can shift again to the macro-economic data, which is looking fairly good.”

Sasol, Cnooc

South Africa’s Sasol Ltd. and Cnooc Ltd. of China climbed, driving the MSCI emerging index higher. The Micex index in Russia, the world’s largest energy supplier, advanced 0.9 percent for the first gain in four days. The ruble strengthened 0.6 percent against the dollar, heading for its biggest weekly rise this year.

The MSCI World Index of 23 developed nations’ stocks rose 0.3 percent, while the Stoxx Europe 600 Index advanced 0.3 percent. Volkswagen AG, Europe’s biggest carmaker, climbed 2.7 percent in Frankfurt on speculation yesterday’s announcement of a convertible-bond sale reduces the likelihood of a rights offer.

The MSCI Asia Pacific Index advanced 0.4 percent as Japan’s Nikkei 225 climbed 0.8 percent. Nissan Motor Co., which gets about 77 percent of its revenue outside Japan, increased 2.4 percent.

Confidence, Inventories

A report from Reuters/University of Michigan, due at 9:55 a.m., may show the group’s preliminary consumer sentiment index for March rose to 74 from 73.6 last month. A Commerce Department report at 10 a.m. may show business inventories increased 0.1 percent in January.

The yen weakened to 124.18 per euro, from 123.82. The pound strengthened 0.5 percent to $1.5139 after U.K. house prices increased in February at the fastest pace in more than seven years.

The Swiss franc strengthened to 1.4589 per euro, from 1.4617 yesterday, even after the central bank said yesterday it would act to stem “an excessive appreciation” against the euro. The Dollar Index declined 0.5 percent to 79.922, paring its gain for the year to 2.7 percent.

“The Bank of Japan is sensitive to the dangers of deflation, after the yen appreciated in the current cycle, and is looking at intervention, along with the Swiss National Bank,” said Henrik Gullberg, a currency strategist at Deutsche Bank AG in London.

Gold, Oil

Gold for immediate delivery gained 0.7 percent to $1,116.90 an ounce in London and silver added 0.7 percent to $17.295 an ounce. Nickel for delivery in three months advanced 1.6 percent to $21,625 a metric ton, taking its gain this year to 17 percent, the most of any of the main metals traded on the London Metal Exchange.

Crude oil rose 0.3 percent to $82.35 a barrel in New York, before a meeting of the Organization of Petroleum Exporting Countries next week.

The yield on the 10-year Greek bond, the country’s new benchmark, fell 1 basis point to 6.34 percent, while the two- year note yield advanced 10 basis points to 5.12 percent. The yield premium investors demand to hold the 10-year security over German bunds declined 4 basis points to 311 basis points.

The cost of protecting against a default on Greek government bonds rose, with credit-default swaps climbing 5 basis points to 307, according to CMA DataVision prices.

article source:  businessweek