By Michael P. Regan and Rita Nazareth
March 9 (Bloomberg) — U.S. stocks rose, halting a global slide, and the dollar pared gains amid growing optimism an improving American economy will justify a yearlong rally in equities. Oil fell, pacing a retreat in commodities.
The Standard & Poor’s 500 Index climbed 0.5 percent to a seven-week high of 1,144.29 at 2:24 p.m. on the anniversary of its 12-year low in 2009. The Dollar Index advanced 0.1 percent to 80.534 after climbing as much as 0.5 percent. Crude slipped 0.6 percent from an eight-week high, trimming a drop of as much as 2.1 percent as the dollar weakened from its strongest levels of the day. Treasuries rose as a $40 billion auction of three- year notes drew a lower yield than forecast.
The S&P 500 has rallied 69 percent since March 9, 2009, as the Federal Reserve left its benchmark interest rate at a record-low range near zero to end the worst economic contraction since the Great Depression. The S&P GSCI Index of commodities has surged 55 percent over the same period.
“Momentum for stocks has been positive,” said Kevin Caron, a market strategist at Stifel Nicolaus & Co. in Florham Park, New Jersey, which has about $90 billion in client assets. “We’ve seen generally improving economic numbers. And on the international front, heightened fears about the European sovereign debt situation have abated.”
Telephone shares in the S&P 500 climbed 1.6 percent collectively for the top advance among 10 groups as Sprint Nextel Corp. gained for a second day after saying it will pay down debt and control expenses. American International Group Inc., the insurer rescued by the U.S., jumped 17 percent on speculation the firm may sell more assets as it raises cash to pay off the government.
Losses Recovered
The S&P 500 has recovered all but 0.5 percent of an 8.1 percent plunge from this year’s high triggered by concern some European countries won’t be able to pay back debt and speculation the Fed will need to rein in stimulus measures as the economy improves.
The MSCI World Index of 23 developed nations’ stocks gained 0.1 percent, reversing a drop of as much as 0.5 percent.
European stocks were little changed as the Stoxx Europe 600 Index recovered from a 0.8 percent decline. The gauge has rallied 63 percent since its 12-year low a year ago.
European Aeronautic, Defence & Space Co. fell 2.8 percent after the owner of airplane maker Airbus SAS said it plans to scrap its annual dividend after the company posted a yearly loss. Nestle SA, the world’s biggest food company, rose 1.2 percent in Zurich after JPMorgan Chase & Co. raised its recommendation on the stock to “overweight” from “neutral.”
Asian Shares
Most stocks in the MSCI Asia Pacific Index retreated. Fujitsu Ltd. declined for a second day in Tokyo, slumping 3.9 percent after altering its explanation for the resignation of its former president.
The 10-year Greek bond yield increased 4 basis points to 6.26 percent, with the premium investors demand to hold the securities instead of bunds widening 7 basis points to 313 basis points, according to Bloomberg generic yields.
Greek Prime Minister Minister George Papandreou will press U.S. President Barack Obama to help Europe combat “unprincipled speculators,” who he said have roiled markets and threaten a new global financial crisis. Papandreou, struggling to convince investors his government is serious about taming Europe’s biggest budget deficit, meets Obama and Treasury Secretary Timothy F. Geithner today in his first U.S. visit since being elected in October.
The MSCI Emerging Markets Index climbed 0.3 percent after slumping as much as 0.5 percent earlier.
Crude oil for April delivery dropped 0.6 percent to $81.36 a barrel in New York, its first drop in three days. The S&P GSCI Index of commodities slumped 0.6 percent, also the first drop in three sessions.
To contact the reporters on this story: Michael P. Regan in New York at mregan12@bloomberg.net; Rita Nazareth in New York at rnazareth@bloomberg.net.
Last Updated: March 9, 2010 14:37 EST
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