Oct. 1. 2010 – James Paulsen, chief investment strategist at Minneapolis-based Wells Capital Management, which manages $342 billion, talks about the outlook for U.S. stocks. U.S. stocks fell, trimming the biggest September gain since 1939 for the Standard Poor’s 500 Index, as investors sold some of the month’s best-performing shares amid speculation that improving economic data will reduce the need for the Federal Reserve to stimulate growth. Paulsen talks with Rishaad Salamat on “First Up.”
Asian shares advanced, copper climbed to the highest level since 2008 and crude oil traded above $80 a barrel as better-than-expected Chinese manufacturing and U.S. economic data reduced concern the global recovery will falter.
The MSCI Asia Pacific Index gained 0.3 percent to 126.68 as of 11:51 a.m. in Tokyo, on course for its fifth consecutive weekly increase. Standard Poor’s 500 Index futures climbed 0.4 percent. Copper rose as much as 0.8 percent to $8,078 a metric ton in London and crude reached a high of $80.43 a barrel. The Australian and New Zealand dollars strengthened amid demand for higher-yielding currencies.
Investor sentiment improved after China’s logistics federation said its purchasing managers’ index increased to 53.8 from 51.7 in August, the fastest pace in four months. U.S. business activity unexpectedly accelerated and fewer workers filed claims for jobless benefits, reports said yesterday, while U.S. Treasury Secretary said he was
confident tensions over the yuan wouldn’t lead to escalating trade sanctions or feed into a broader global currency conflict.
“Conditions are better in the U.S. and globally than how we are perceiving them,” chief investment
strategist at Wells Capital Management, which manages $342 billion, said in a Bloomberg Television interview. “All we see is bad when there’s been a global recovery now for a year or a year and a half.”
More stocks advanced than fell on the MSCI Asia Pacific Index. Japan’s Nikkei 225 Stock Average gained 0.9 percent and the SP/ASX 200 Index in Australia added 0.1 percent. Markets are closed in China and Hong Kong for a holiday.
Korean Banks, BHP KB Financial Group Inc. and Shinhan Financial Group Co climbed at least 2 percent on speculation accelerating inflation may prompt South Korea’s central bank to raise interest rates,benefiting margins for financial companies. Mining stocks gained, with BHP Billiton Ltd. climbing 1.4 percent in Sydney and Rio
Tinto Group adding 0.2 percent.
Copper for three-month delivery on the London Metal Exchange strengthened to the highest level since Aug. 1, 2008,
and was poised for a third weekly increase. Crude for November delivery rose as much as 0.6 percent to $80.43 a barrel on the New York Mercantile Exchange, extending a 5 percent gain over
the past two days.
Credit-default swap indexes fell, with the Markit iTraxx Asia index of 50 investment-grade borrowers outside Japan
declining 2 basis points to 117 points, according to prices from Deutsche Bank AG. The indicator of corporate credit risk in Asia, which typically falls as investor confidence improves, was set
for its lowest closing price since Sept. 17.
Australia, N.Z. Currencies
Australia’s currency gained 0.2 percent to 96.92 U.S. cents from yesterday in New York, when it climbed as high as 97.34 cents, the most since July 2008. New Zealand’s dollar rose to 73.71 U.S. cents from 73.43 cents yesterday. China is the largest trading partner of Australia and New Zealand’s second- biggest export market.
The euro gained for a fourth day versus the dollar before reports forecast to show U.S. manufacturing slowed last month
and German retail sales increased in August. The euro climbed to $1.3655 in Tokyo from $1.3634 yesterday in New York when it reached $1.3683, the strongest since April 12. The common currency traded at 114.05 yen from 113.88 yen. The dollar was at 3.51 yen from 83.53 yesterday when it touched 83.17 yen, the weakest level Sept. 15.
The Institute for Supply Management’s factory index fell to 54.5 in September from 56.3 in August, according to a Bloomberg survey of economists before today’s data. German retail sales rose 0.4 percent in August after a 0.1 percent drop the prior month, according to a Bloomberg survey ahead of data today.
South Korea’s won added 0.3 percent to 1,136.50 per dollar, heading for a fifth weekly gain, after government data showed consumer prices rose 3.6 percent in September, the fastest pace in 17 months. The Taiwan dollar rose 0.5 percent to NT$31.16 per dollar after the central bank yesterday raised its benchmark interest rate by 0.125 percentage point to 1.5 percent.