By Rita Nazareth and Justin Carrigan Feb. 2 (Bloomberg) — Stocks and commodity prices rose, led by rallies in oil and aluminum, and the Brazilian real and South African rand increased on optimism that an expanding global economy will increase demand for raw materials. Crude oil rallied 2 percent, aluminum gained 1.6 percent and commodity producers in the MSCI World Index jumped 1.9 percent as a group at 10:47 a.m. in New York. Brazil’s real gained against 15 of 16 major counterparts and the rand strengthened against 14 of 16. The Standard & Poor’s 500 Index added 0.7 percent to 1,096.4 as earnings topped estimates at companies from United Parcel Service Inc. to D.R. Horton Inc. and Lexmark International Inc. Freeport-McMoRan Copper & Gold Inc., Alcoa Inc. and Rio Tinto Plc rallied at least 1.2 percent as Citigroup Inc. advised buying the shares on prospects for higher metal prices. Optimism that the global economic recovery is strengthening was bolstered by reports showing industrial production in Brazil increased more than estimated, while sales of existing U.S. homes rose. “The market seems to be moving back towards fundamentals,” said James Paulsen , who helps oversee about $375 billion as chief investment strategist at Wells Capital Management in Minneapolis. “When you look at economic data and earnings reports, most remain pretty good. It looks like several companies are off to a good start in profits. There’s good momentum there.” Builders Rally All 12 shares in a gauge of U.S. homebuilders advanced after D.R. Horton, the second-largest U.S. homebuilder by revenue, reported its first quarterly profit since 2007 and the National Association of Realtors said its index of pending home sales increased 1 percent following a record 16 percent plunge in November. Copper for March delivery added as much as 1.3 percent to $3.1245 a pound in New York, while aluminum gained 1.6 percent in London. Treasury 10-year note yields traded near the middle of a range they’ve been in since May before a report this week forecast to show the U.S. added the most jobs last month in two years, signaling the economy is strengthening. Yields on the benchmark note were steady at 3.65 percent before the U.S. announces tomorrow how much it will sell in auctions of 3-, 10- and 30-year securities next week. To contact the reporters on this story: Justin Carrigan in London at jcarrigan@bloomberg.net ; Rita Nazareth in New York at rnazareth@bloomberg.net
Visit link:
Stocks, Commodities Rally on Economic Expansion as Real, Rand Strengthen
