European stocks climb with US equity futures; yen weakens

Bloomberg

Stocks in Europe began the week advancing alongside the US futures after equities set fresh record highs. The yen weakened.
Mining shares led gainers in Europe along with utilities including Suez SA, which jumped after an approach by rival Veolia Environnement SA. Contracts on the three main American stock indexes pointed to a strong open on Wall Street. Markets in the UK are closed for a public holiday.
Equities in Japan outperformed peers in Asia, bolstered by Berkshire Hathaway Inc.’s purchase of stakes in five major trading companies, one of billionaire Warren Buffett’s biggest investments in the nation. The yen gave back some of last week’s gain, the biggest in five months, as Japan searched for a new prime minister. Silver rose, outperforming gold.
Investors have taken comfort from the global economy’s re-emergence from virus shutdowns, prospects for a vaccine and a commitment by central banks to foster the recovery, underscored last week by the Federal Reserve’s plan to shift to a more relaxed approach on inflation. A gauge of global equities is on course to a rise for a fifth straight month, the longest such streak since early 2018.
Still, coronavirus infections in the US are ticking up again, India recorded its biggest daily spike and cases worldwide surpassed 25 million, illustrating the pandemic is far from beaten.
“While momentum has slowed in light of rising cases, in the US in July and in Europe in August, the economic recovery continues to unfold,” Esty Dwek, head of global market strategy at Natixis Investment Managers Solutions, said in a note. “Central banks have already stated they would remain ultra-accommodative for a long time. Risk assets are likely to remain supported, even if the ride will probably be bumpy.”
The S&P 500 closed at an all-time high for a sixth consecutive trading session on August 28, while the Nasdaq Composite also reached a record. Chinese economic activity continued to rebound in August as the world’s second-largest economy emerged from the virus slump. West Texas crude oil advanced above $43
a barrel.
Meanwhile, tensions between the US and China continue to simmer. In another development, ByteDance Ltd. will be required to seek Chinese government approval to sell the US operations of its short-video TikTok app under new restrictions Beijing imposed on the export of artificial intelligence technologies.
Futures on the S&P 500 Index increased 0.3% as of 9:29 am London time and the Stoxx Europe 600 Index gained 0.5%.
While Germany’s DAX Index advanced 0.6%, the MSCI Asia Pacific Index decreased 0.7%.
The Bloomberg Dollar Spot Index advanced 0.2% and the euro declined 0.1% to $1.1886. The Japanese yen weakened 0.5% to 105.87 per dollar and the British pound fell 0.4% to $1.3303.
While the yield on 10-year Treasuries dipped less than one basis point to 0.72%, Germany’s 10-year yield gained one basis point to -0.40%. Britain’s 10-year yield decreased three basis points to 0.311%.
West Texas Intermediate crude gained 1.1% to $43.46 a barrel and gold weakened 0.3% to $1,958.31 an ounce. Soybeans advanced 1.5% to $9.65 a bushel.