European stocks advance as investors weigh partial US shutdown: PARIS, Oct 1 — European stocks climbed, rebounding from their biggest decline in a month, as investors assessed the impact of a partial shutdown of the US government. US index futures and Asian shares also advanced. Wolseley Plc gained 2.3 per cent after posting full-year earnings that beat estimates. Unilever NV slid to its lowest price in 11 months as the world’s second-largest consumer-goods maker said sales growth slowed in the third quarter. The Stoxx Europe 600 Index added 0.3 per cent to 311.36 at 9.31am in London as a report showed that manufacturing activity in the euro area expanded for a third month in September. The equity benchmark fell by the most since Aug 30 yesterday as US politicians failed to agree on a compromise budget and Silvio Berlusconi pulled his ministers out of Italy’s coalition government. “The market is torn between the good and improving news, which we’ve nicknamed the global healing, and the headwinds from the political environment,” Franz Wenzel, who helps oversee about US$771 billion (RM 2.2 trillion) as chief strategist at Axa Investment Managers SA in Paris, said by telephone. “It seems that this morning the economic healing is taking the upper hand.” The Stoxx 600 gained 8.9 per cent in the three months through September, its largest quarterly rally in four years, as the euro-area economy escaped from recession and the Federal Reserve decided against reducing its monthly asset purchases. Standard & Poor’s 500 Index futures climbed 0.5 per cent today, while the MSCI Asia Pacific Index rose 0.3 per cent. US shutdown US lawmakers in Washington missed a midnight deadline to reach a compromise to continue funding the government. The shutdown will put as many as 800,000 federal employees out of work today, closing national parks and halting some government services. The Democrat-controlled Senate earlier voted 54-46 against a funding bill from the Republican-controlled House of Representatives because it made major changes to President Barack Obama’s health-care legislation. The parties had no immediate plans for further negotiations. That raised concerns among some lawmakers that the shutdown could lead to a fight economists consider even more important: how to raise the nation’s debt limit to avoid a default after Oct 17. The US will run out of money to pay all of its bills at some point between Oct 22 and Oct 31 unless Congress increases the federal government’s borrowing authority, according to the Congressional Budget Office. Tankan jumps Stocks in Asia advanced after the Bank of Japan’s Tankan index, which surveys confidence among the nation’s large manufacturers, climbed more than economists had estimated. The quarterly gauge rose to 12 in September, its highest level since 2007. Separately, China’s official measure of factory activity increased for a third month. A report from Markit Economics showed that its euro-zone factory index fell to 51.1 in September, matching the preliminary estimate and the median forecast of 31 economists surveyed by Bloomberg News. Readings greater than 50 mean that manufacturing activity increased. Wolseley added 2.3 per cent to 3,270 pence. The world’s biggest distributor of plumbing and heating products said so- called trading profit in the 12 months through July climbed to £725 million (RM 3.85 billion) from £665 million a year earlier. Analysts had predicted earnings of £704 million, according to the average of 20 estimates compiled by the company. Wolseley proposed a special dividend pay-out of £300 million. Unilever slipped 3.4 per cent to £27.77 after saying sales growth slowed as the strengthening of the euro led to a further slowdown in emerging markets. Underlying sales for the three months will rise 3 per cent to 3.5 per cent, the maker of Lipton tea and Dove soap said late yesterday in a statement. That compares with 5 per cent growth in both the first half and second quarter. — Bloomberg dlvr.it/43nvjd
Posted on: Tue, 01 Oct 2013 10:01:23 +0000
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