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Stocks Rise in U.S., Europe as Metals Gain on Economy Optimism

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By Rita Nazareth and Claudia Carpenter

June 9 (Bloomberg) — Stocks rose in the U.S. and Europe while metals rallied and Treasuries fell after Reuters reported a surge in China’s exports and Federal Reserve Chairman Ben S. Bernanke said policy makers will act as needed to aid the economic recovery. Debt sales drove down German and U.K. bonds.

The Standard & Poor’s 500 Index added 0.5 percent to 1,067.05 at 10:46 a.m. in New York, while the Stoxx Europe 600 Index gained 1.2 percent, snapping three days of losses. China’s Shanghai Composite Index climbed 2.8 percent, the most in more than two weeks. Copper and oil rose, and gold retreated from yesterday’s record. German notes fell after a 4.6 billion-euro ($5.5 billion) debt sale, sending 10-year yields up five basis points to 2.56 percent. Ten-year Treasury note yields rose 4 basis points to 3.22 percent.

The S&P GSCI Index of commodities jumped 2.3 percent, the most in two weeks, after Reuters reported that China’s exports in May grew about 50 percent from a year earlier. Bernanke told Congress that the impact of Europe’s debt crisis on U.S. growth will likely be “modest” if financial markets continue to stabilize and international policy makers will continue to cooperate to ensure they do so.

“The global recovery is on track,” said John Praveen, the Newark, New Jersey-based chief investment strategist at Prudential International Investments Advisers LLC, which oversees $693 billion. “Bernanke has reassured the market that the Fed will do whatever it takes to keep the U.S. economy going. In addition to that, we had a positive report on Chinese exports easing concern about a slowdown.”

Retreat from High

The S&P 500 has tumbled 12 percent from its 19-month high in April amid concern the global economic recovery will slow as some European nations struggle to finance budget deficits. Most advanced economies are experiencing a “subdued” recovery, and risks to the global economic outlook have “risen significantly,” International Monetary Fund Deputy Managing Director Naoyuki Shinohara said.

“China’s export numbers showing that global trade remains strong are helping lift market sentiment,” said Sebastian Paris-Horvitz, a Paris-based chief investment strategist at AXA Investment Managers. “However, it would be wrong to conclude that fears about sovereign debt is fading. Volatility is likely to remain high.”

A survey of Bloomberg customers showed 73 percent of participants expect Greece to default. Germany, Portugal, the U.K. and the U.S. are selling bonds today to cover burgeoning deficits.

Beige Book

The Federal Reserve will release its Beige Book, a summary of commentary on economic conditions, later today.

China led gains in emerging markets including Russia, South Africa and the Czech Republic. The Micex Index rose 1 percent in Moscow, and the gauge for shares in Johannesburg increased 2 percent. The Czech PX index advanced 0.4 percent after a report showed the economy returned to growth at the start of the year after shrinking for four quarters.

Copper for delivery in three months climbed 2.2 percent to $6,305 a metric ton on the London Metal Exchange, and gold for immediate delivery fell 0.3 percent to $1,232.40 an ounce, and down from a record $1,252.11 yesterday.

Oil futures extended gains after the U.S. Energy Department’s report on stockpiles showed decreases in inventories of gasoline and crude. Crude oil for July delivery rose $2.41, or 3.4 percent, to $74.40 a barrel at 10:31 a.m. on the New York Mercantile Exchange.

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