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Tokyo - Asia’s stocks climbed with European equity- index futures as investors count down to the end of a turbulent year for global markets. Gold advanced with oil.
The MSCI Asia Pacific Index rose 0.4% and China’s Shanghai Composite Index added 0.9%, calming nerves after a late-afternoon rout on Monday spooked global markets. Trading volumes across Asia were below the average for the time of day.
Crude was higher after retreating more than 3% on Monday. Gold climbed 0.4% as the Bloomberg Dollar Spot Index traded near a two-week low. Aluminum led losses on the London Metal Exchange.
“Commodity related sectors continue to be a drag,” said Toshihiko Matsuno, chief strategist at SMBC Friend Securities in Tokyo. “Whenever the weakness in oil regains market attention, it weighs on sentiment. Movement in Chinese shares will continue to have an effect on other markets.”
The Shanghai Composite Index fluctuated after tumbling Monday as slumping industrial profits added to concern that looming changes to the country’s listing regime and the expiration of a share-sale ban will hurt demand for its stocks.
The global oil glut and weakness in the world’s second-largest economy are driving Bloomberg’s gauge of commodity prices toward its biggest annual drop in seven years, undermining corporate earnings and hindering central banks’ struggle to ignite inflation. Data on US home prices and consumer confidence are due.
The Bloomberg Commodity Index is down 25% in 2015, and other asset classes are also set to post declines. The MSCI All-Country World Index, which tracks developed and emerging equity markets, has slumped 3.9%, while global bonds have lost 2.4%, according to a Bank of America Merrill Lynch index. A measure tracking world currencies fell 2.3%.
Stocks
The MSCI Asia Pacific Index is heading for its first back- to-back annual loss since 2002 as a deceleration in the region’s biggest economy and the rout in oil and commodity prices undermined earnings. The measure added 0.4% by 7:06 a.m. in London, Futures on the Euro Stoxx 50 Index increased 0.8%, signalling the region’s equities may pare what is looking like their worst December loss since 2002 after an addition in European Central Bank stimulus fell short of investor expectations and energy and commodity producers deepened their losses. FTSE 100 Index futures were flat ahead of London’s first post-Christmas trading.
The number of Hang Seng Index shares changing hands was about 60% below the 30-day average for the time of day, while volume in Shanghai was about 40% lower, according to data compiled by Bloomberg. The Hang Seng Index added 0.3% and a gauge of Chinese shares in Hong Kong was little changed after tumbling the most in a month with its Shanghai counterpart on Monday.
Japan’s Topix index advanced 0.9% and South Korea’s Kospi was little changed. Gains by Australian banks offset losses by the big miners, Rio Tinto Ltd. and BHP Billiton, with the S&P/ASX 200 Index rising 1.2% as trade resumed after Christmas holidays.
New Zealand’s benchmark stock gauge rose 1.1% for a ninth straight advance and a record close. The South Pacific country’s shares are about 13% in 2015, a fourth straight annual advance.
Standard & Poor’s 500 Index futures climbed 0.2%. The S&P 500 dropped 0.2% on Monday, after earlier falling as much as 0.8%. With just three trading days left in the year, the US benchmark is little changed for 2015. Volume on US exchanges was about 31% lower than the three-month average.
Commodities
Gold for immediate delivery climbed to $1 072.18 an ounce. Gold is heading for a third annual decline as expectations for tighter monetary policy in the US curbed demand for the metal, which doesn’t pay interest.
West Texas Intermediate erased early losses to climb 0.5%. The contract slumped 3.4% in New York on Monday as Iran’s plans to add supply as soon as it is allowed scuttled last week’s rally. WTI for February delivery slipped $1.29 to settle at $36.81 a barrel on the New York Mercantile Exchange. The volume of all New York oil futures traded was more than 50% below the 100-day average on Monday.
US natural gas futures advanced 1% on Tuesday. They surged 10% yesterday, a third straight increase, amid forecasts for an end to unseasonably warm conditions that had curbed demand for heating fuel. UK gas futures also rose more than 1% on Tuesday.
Aluminum retreated in London as trade resumed for the first time since Thursday. Copper for three-month delivery was little changed, erasing an early retreat, while aluminum slid 1% and nickel fell 0.4%.
Currencies
The Bloomberg Dollar Spot Index was little changed as the greenback pared earlier declines against the yen and euro. The gauge that tracks the US currency against 10 of its most- traded peers has retreated since the Federal Reserve increased interest rates for the first time in almost a decade.
The euro was little changed at $1.0967. The joint currency will fall about 4% against the dollar in 2016, according to the consensus of analyst forecasts compiled by Bloomberg, though two of the biggest participants in the market - Barclays and Bank of America Corporation’s Merrill Lynch unit - expect it to drop through parity with the greenback.
