Azernews.Az

By Bloomberg

European stocks fell, Treasuries and gold rose as Greek government bonds dropped after the country’s prime minister reaffirmed his rejection of the nation’s bailout. Russia’s ruble rallied as talks on a cease-fire in Ukraine continued.

The Stoxx Europe 600 Index slid 0.9 percent by 8:16 a.m. in New York while Standard & Poor’s 500 Index futures sank 0.5 percent. Greece’s three-year note yield rose to the highest since the nation’s debt was restructured in 2012 while the nation’s bank bonds were among the worst performing in Bank of America Merrill Lynch’s Euro Financial High Yield index. Treasury 10-year note yields fell three basis points while gold rose 0.4 percent and Russia’s ruble strengthened 0.9 percent. Nigeria’s currency fell to a record after elections were delayed. The Hang Seng Index dropped after Chinese imports plunged while oil held gains.

Greek Prime Minister Alexis Tsipras vowed to negotiate an end to austerity before talks with creditors, while Russia’s foreign minister warned the U.S. and its allies against sending weapons to Ukraine. The biggest import slump in more than five years pushed China’s January trade surplus to a record, highlighting the impact of commodity prices on the world’s second-biggest economy.

“The word to describe the situation would be fear,” said John Plassard, vice president at Mirabaud Securities LLP in Geneva. “Tsipras announced Greece would not accept an extension of the financial-assistance program. This raises concerns of tensions and fears for the worst for Greek banks and European banks.”

Bank Stocks

The Stoxx 600 fell for the first time in six days, with banks and carmakers declining the most.

UBS Group AG lost 1.6 percent as people familiar with the matter said the U.S. Justice Department is looking into whether the Swiss bank misled clients in the marketing and selling of some foreign-exchange structured products.

HSBC Holdings Plc declined 2.1 percent after a report by the International Consortium of Investigative Journalists showed its private-banking unit made profits for years handling secret accounts for criminals. BNP Paribas SA slid 3.3 percent after JPMorgan Chase & Co. lowered the stock to a rating similar to sell.

Greek equities slipped for a third day after completing their biggest weekly gain since November. Alpha Bank AE and Piraeus Bank SA lost more than 8 percent. Italy’s FTSE MIB Index and Spain’s IBEX 35 Index declined more than 2 percent, and Germany’s DAX Index retreated 1.6 percent after the nation posted a record current-account surplus in 2014.

S&P 500 futures expiring in March fell, indicating the index will decline for a second day after posting its biggest weekly advance since December.

Bank Bonds

Apple Inc. hired banks to arrange its first sale of bonds denominated in Swiss francs, according to a person familiar with the matter. Credit Suisse Group AG and Goldman Sachs Group Inc. will market the securities in the near future, subject to market conditions.

National Bank of Greece SA’s 4.375 percent notes due April 2019 fell for a fourth day, sliding 4.81 cents on the euro to 58.8 cents, according to data compiled by Bloomberg. Piraeus Bank SA’s 5 percent notes maturing March 2017 fell 4.5 cents on the euro to 67.4 cents, the data show.

It costs $4.4 million upfront and $100,000 annually to insure $10 million of Greek government debt for five years, according to prices compiled by CMA. That signals a 71 percent probability of default.

Credit-default swaps insuring Italian sovereign debt rose nine basis points to 116 and contracts on Spanish bonds increased six basis points to 98, according to data compiled by Bloomberg. Swaps on Russia were little changed at 537 basis points.

Collision Course

Tsipras vowed on Sunday to increase the minimum wage, restore the income tax-free threshold and halt infrastructure privatizations in a speech that sets him on a collision course with the country’s creditors. Finance Minister Yanis Varoufakis faces his 18 euro-area counterparts on Feb. 11 at an emergency meeting in Brussels.

“How he’s going to fund these pledges and still convince the ECB to allow Greek banks to use the central bank’s collateral is beyond me,” Peter Dixon, global equities economist at Commerzbank AG in London, said by phone. “We’re still trying to move toward a solution but we’re not making much progress. Under those circumstances, markets are going to suffer.”

Greek government bonds fell for a fourth day. The rate on three-year notes jumped 370 basis points to 21.70 percent. Ten- year yields increased 71 basis points to 10.82 percent.

That helped drag Italian bonds lower, with the 10-year yield rising seven basis points to 1.65 percent as investors shunned the securities of the euro area’s most-indebted nations.

Treasuries, Yen

The selloff in Greek assets also boosted demand for havens, with the yield on Germany’s 10-year bunds dropping four basis points to 0.34 percent and the 10-year gilt yield declining five basis points to 1.60 percent.

The gain in Treasuries pushed yields lower after the 10- year rate jumped 14 basis points on Friday, when a report showed U.S. payrolls topped estimates, boosting odds of an interest- rate increase in the first half of 2015.

Japan’s yen strengthened for the first time in three days, appreciating 0.4 percent to 118.60 per dollar. The euro weakened against its U.S. counterpart, slipping 0.4 percent to $1.1275.

Gold climbed to $1,240.20 an ounce, after its worst weekly performance since October.

The MSCI Emerging Markets Index fell for a second day, losing 0.8 percent. Benchmark gauges in Turkey and Poland slid more than 0.6 percent.

Russian Rates

Russia’s Micex Index of stocks was little changed. Discussions over Ukraine will resume on Monday aimed at preparing a summit for the leaders of Germany, France, Russia and Ukraine in Minsk, Belarus, on Feb. 11. President Vladimir Putin said all sides must first agree on their positions before talks on Ukraine can take place.

Russia’s central bank is unlikely to reverse last month’s surprise rate cut as inflation is set to slow after it accelerated to the fastest in almost seven years, according to Governor Elvira Nabiullina.

The Hang Seng China Enterprises Index of mainland companies listed in Hong Kong dropped 0.4 percent. The Shanghai Composite Index rose 0.6 percent amid speculation the start of options trading will boost demand for large-capitalization shares.

China’s imports fell by the most in more than five years in January, declining 19.9 percent from a year earlier, and exports slid 3.3 percent, the customs administration in Beijing said Sunday.

Naira, Oil

India’s S&P BSE Sensex slid for a seventh day, the longest stretch in 15 months. Exit polls predict a defeat for Prime Minister Narendra Modi’s party in Delhi state elections, which may boost the morale of opposition parties that are seeking to block many of his economic policies.

Nigeria’s naira fell for a sixth day, losing 0.7 percent, after the country’s electoral commission said at the weekend the presidential and parliamentary election scheduled for Feb. 14 will be put back to March 28 because of attacks by the Islamist Boko Haram group.

West Texas Intermediate oil rose 1.5 percent to $52.47 a barrel in New York following a weekly gain of 7.2 percent. The contract has rebounded on speculation a declining rig count in the U.S. is signals output will slow. Price volatility rose to the highest level in almost six years on Friday.