European stocks rose with U.S. equity-index futures, buoyed by an increase in oil prices after the International Energy Agency softened its forecast for a global supply surplus. Norway’s krone jumped and South Africa’s rand also strengthened.
The Stoxx Europe 600 Index reversed a drop of as much as 1 percent, overcoming a drag from companies including LafargeHolcim Ltd. that posted lower earnings. Crude gained for a third straight day as the IEA said robust demand in India and other emerging nations would support demand for oil. Norway’s krone appreciated versus all its 16 major counterparts after the central bank refrained from cutting interest rates and as commodity prices climbed. U.K. government bonds halted their longest winning streak on record.
“The global supply surplus of oil will shrink dramatically later this year,” the Paris-based IEA, which advises 29 of the most industrialized nations on energy policy, said in a report. “Changes to the data in this month’s report confirm the direction of travel of the oil markets towards balance.”
After dropping to as low as $26.05 a barrel in February, oil futures have rallied to close at a six-month high above $46 a barrel in New York on Wednesday, after supplies were tightened by declining U.S. drilling, wildfires in Canada and disruptions in Nigeria. That’s helping to stabilize global equities, which were roiled by losses in commodities in the first six weeks of the year and more recently by disappointing company earnings.
The Stoxx Europe 600 Index added 0.2 percent as of 10:30 a.m. London time and S&P 500 futures gained 0.4 percent. Crude rose 0.8 percent to $46.60 a barrel in New York. The krone strengthened 0.8 percent to 9.2551 per euro.
Energy companies posted the biggest gains in European equities, with Total SA and Royal Dutch Shell Plc gaining more than 1 percent. Zurich Insurance Group AG added 6.1 percent after Switzerland’s biggest insurer posted a first-quarter profit that beat analysts expectations. RWE AG jumped 7.7 percent after the German power producer said that first-quarter profit was little changed as “unusually high earnings” from trading countered slumping power prices.
LafargeHolcim fell 1.1 percent after reporting first-quarter earnings that missed estimates. Credit Agricole SA was among the biggest losers, slipping 4.8 percent after posting a 71 percent drop in first-quarter profit.
Futures indicate U.S. equities will rebound after falling for the first time in four days on Wednesday. Retail and apparel companies were the hardest hit, posting their worst declines since the depths of the correction earlier this year as disappointing results from Macy’s Inc. to Walt Disney Co. heightened concern that American consumers remain reluctant to boost spending. Ralph Lauren Corp. is among companies reporting earnings Thursday.
The MSCI Asia Pacific Index fell 0.3 percent, after earlier sliding as much as 0.6 percent. Benchmarks in Hong Kong and Shanghai declined to two-month lows. CK Hutchison Holdings Ltd. dropped to its lowest since February in Hong Kong after European Union regulators vetoed the company’s plan to buy U.K. carrier O2 for as much as 10.25 billion pounds ($15 billion).
An exchange-traded fund tracking Brazilian shares held at this month’s high as a vote to impeach President Dilma Rousseff began. The majority of Brazilian senators have declared their intention to seek the impeachment of Rousseff in a vote scheduled for early Thursday.
U.S. oil output declined to 8.8 million barrels a day last week, the lowest level since September 2014, while stockpiles fell 3.41 million barrels, a report showed Wednesday. Analysts surveyed by Bloomberg had projected a 750,000-barrel increase in supplies.
Copper for three-month delivery on the London Metal Exchange gained 0.5 percent. Codelco, the world’s biggest producer, sees prices rising toward the end of next year as investment cuts hasten a re-balancing of global supply and demand. The LMEX Metals Index, which tracks the six main metals traded on the LME, gained 0.9 percent on Wednesday, rebounding from a one-month low.
Gold fell 0.8 percent, reflecting gains in the dollar. It has surged almost 20 percent this year as the Federal Reserve refrained from raising interest rates and the European Central Bank and Japan stepped up monetary stimulus. A World Gold Council report showed Thursday that global demand in the first quarter was the second-highest on record.