Stocks in Europe and Asia climbed, trimming the MSCI World Index's worst annual decline on record, as governments stepped up measures to boost the global economy. US index futures advanced.
Rio Tinto Group, which was valued this month at the cheapest on record relative to earnings, added 1.5 percent. General Motors Corp jumped 10 percent in Germany as the US Treasury committed US$6 billion to support the automaker's financing arm.
"To see the US supporting a company like GM is positive," said Kilian de Kertanguy, a fund manager at Cholet-Dupont Gestion in Paris, which oversees about US$2.3 billion. "There isn't much activity this week, however, so the market is rising in a vacuum."
The MSCI World Index climbed for a fourth straight day, adding 0.3 percent to 903.32 at 11:02 am in London. Futures on the Standard & Poor's 500 Index gained 0.7 percent.
The MSCI World has dropped 43 percent this year as credit- related losses and writedowns at financial firms that topped US$1 trillion pushed the US, Europe and Japan into the first simultaneous recessions since World War II.
The gauge of stocks in 23 developed nations is now valued at 11.7 times the earnings of its 1,693 companies, compared with an average ratio of 26.5 this decade, data compiled by Bloomberg show.
Europe's Dow Jones Stoxx 600 Index climbed for a second day, adding 1 percent as Total SA and ASML Holding NV advanced. Some 1.25 billion of Stoxx 600 shares changed hands yesterday, the lowest level this year, data compiled by Bloomberg show.
The MSCI Asia Pacific Index increased 0.7 percent yesterday as Sony Corp climbed.
Rio, the world's third-biggest mining company, rose 1.5 percent to 1,472 pence, trimming its 2008 drop to 72 percent. The shares traded at 1.8 times earnings on Dec 5, compared with an average ratio of 20.7 since 2001.
Total SA, Europe's third-largest oil company, gained 2.5 percent to 39.02 euros. SBM Offshore NV, the world's biggest producer of floating oil-production platforms, surged 5.2 percent to 9.22 euros.
GM rose 10 percent to US$3.97. The US Treasury committed US$6 billion to support GMAC LLC, the financing arm of GM, widening the government's effort to keep the largest US automaker out of bankruptcy.
Wal-Mart Stores Inc, the world's largest retailer, gained 2.1 percent to US$56.25 in German trading before the report. Apple Inc, the maker of iPods, rose 2.2 percent to US$88.52.
Infineon Technologies AG, Europe's second-biggest maker of semiconductors, climbed 10 percent to 91 cents, paring its 2008 loss to 89 percent.
Infineon has surged 30 percent in four days after the company's Qimonda AG unit received a loan of 325 million euros as part of a rescue package for the distressed German memory-chip maker.
(China Daily December 31, 2008)
