NEW YORK: World stock indexes held near 30-month highs on Monday, Feb 14 and copper surged to an all-time peak, boosted by an unexpected surge in imports into China that underscored that country's strong growth trajectory even as its inflationary pressures might be easing.
The MSCI world equity index rose 0.5 percent, having hit its highest level since August 2008 last week. The Thomson Reuters global stock index also gained 0.5 percent.
London Metal Exchange (LME) copper for three-month delivery hit a record $10,170.25 per tonne in after-hours trade, having closed up $199 at $10,160, matching the previous high. On New York's COMEX metals exchange, benchmark copper traded near record highs set last week.
Preliminary Chinese trade data showed copper imports jumped a surprise 5.7 percent to 364,420 tonnes in January. The volume, which was up 24.7 percent from January 2010, was the highest since September.
"It could very well be that the Chinese economy is running hotter than anyone thinks," said Bart Melek, vice president and director of commodities with TD Bank Financial Group. Copper is often viewed as a barometer for the global economy due to its extensive use in the CONSTRUCTION [] and power sectors.
Talk of slower-than-expected Chinese inflation in January helped ease worries about policy tightening and slowing growth, boosting stock prices worldwide. The official data will be announced on Tuesday.
But analysts cautioned against concluding that Beijing would waver in its campaign to tighten policy further, given the continued increases in global commodity prices and the still-ample pool of excess cash in the economy.
U.S. stocks ended little changed in the lowest volume so far this year. European shares closed at a 29-month high, while Shanghai stocks hit an eight-week high.
Financial markets showed a muted reaction to President Barack Obama's budget proposal that would cut the U.S. deficit by $1.1 trillion over 10 years and set the stage for a bitter fight with Republicans who want tougher spending controls.
EU MEETING
The euro dropped to a three-week low against the dollar, breaking below a crucial 100-day moving average at $1.3543 on electronic platform EBS, as a European finance ministers meeting yielded little progress on the region's fiscal problems.
European finance ministers assessed ways of strengthening their 440 billion euro rescue fund, but Germany remained reluctant to bolster the facility known as the EFSF without commitments on closer economic coordination.
"We have some serious questions over what's going to happen with the EU meeting this week and whether or not they will come to any kind of conclusion on the EFSF," said Andrew Busch, global currency and public policy strategist at BMO Capital Markets in Chicago.
The single euro zone currency also came under pressure after sources told Reuters that German financial regulator BaFin is involved in talks about the restructuring of WestLB as the bank struggles to come up with a rescue deal.
Weakness in the euro helped push the U.S. dollar index, which measures the greenback against a basket of major currencies, to a three-week high of 78.873.
U.S. crude oil futures ended lower for a second straight session, weighed down by high domestic inventories, but gold futures closed higher on fears that Egypt's unrest could spread across the Middle East.
Longer-dated U.S. Treasury debt prices rose with benchmark yields holding just under recent highs as investors awaited data later in the week to gauge the state of the economy and how far yields may need to rise to account for growth. - Reuters
The MSCI world equity index rose 0.5 percent, having hit its highest level since August 2008 last week. The Thomson Reuters global stock index also gained 0.5 percent.
London Metal Exchange (LME) copper for three-month delivery hit a record $10,170.25 per tonne in after-hours trade, having closed up $199 at $10,160, matching the previous high. On New York's COMEX metals exchange, benchmark copper traded near record highs set last week.
Preliminary Chinese trade data showed copper imports jumped a surprise 5.7 percent to 364,420 tonnes in January. The volume, which was up 24.7 percent from January 2010, was the highest since September.
"It could very well be that the Chinese economy is running hotter than anyone thinks," said Bart Melek, vice president and director of commodities with TD Bank Financial Group. Copper is often viewed as a barometer for the global economy due to its extensive use in the CONSTRUCTION [] and power sectors.
Talk of slower-than-expected Chinese inflation in January helped ease worries about policy tightening and slowing growth, boosting stock prices worldwide. The official data will be announced on Tuesday.
But analysts cautioned against concluding that Beijing would waver in its campaign to tighten policy further, given the continued increases in global commodity prices and the still-ample pool of excess cash in the economy.
U.S. stocks ended little changed in the lowest volume so far this year. European shares closed at a 29-month high, while Shanghai stocks hit an eight-week high.
Financial markets showed a muted reaction to President Barack Obama's budget proposal that would cut the U.S. deficit by $1.1 trillion over 10 years and set the stage for a bitter fight with Republicans who want tougher spending controls.
EU MEETING
The euro dropped to a three-week low against the dollar, breaking below a crucial 100-day moving average at $1.3543 on electronic platform EBS, as a European finance ministers meeting yielded little progress on the region's fiscal problems.
European finance ministers assessed ways of strengthening their 440 billion euro rescue fund, but Germany remained reluctant to bolster the facility known as the EFSF without commitments on closer economic coordination.
"We have some serious questions over what's going to happen with the EU meeting this week and whether or not they will come to any kind of conclusion on the EFSF," said Andrew Busch, global currency and public policy strategist at BMO Capital Markets in Chicago.
The single euro zone currency also came under pressure after sources told Reuters that German financial regulator BaFin is involved in talks about the restructuring of WestLB as the bank struggles to come up with a rescue deal.
Weakness in the euro helped push the U.S. dollar index, which measures the greenback against a basket of major currencies, to a three-week high of 78.873.
U.S. crude oil futures ended lower for a second straight session, weighed down by high domestic inventories, but gold futures closed higher on fears that Egypt's unrest could spread across the Middle East.
Longer-dated U.S. Treasury debt prices rose with benchmark yields holding just under recent highs as investors awaited data later in the week to gauge the state of the economy and how far yields may need to rise to account for growth. - Reuters
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