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Pound Strengthens Most Since 2008

Pound Strengthens Most Since 2008Pound Strengthens Most Since 2008

Global equities rallied and the pound strengthened the most since 2008 on signs the campaign for the UK to stay in the European Union was gaining momentum before this week’s referendum.

The Stoxx Europe 600 Index headed for its biggest gain since August and emerging-market shares advanced as a poll showed British voters favored keeping membership of the world’s largest trading bloc by three percentage points. Sterling jumped 2%, Spanish and Italian bonds gained and credit risk fell the most since March, Bloomberg reported.

The pound strengthened against all except one of its 31 major peers, rising the most since December 2008 against the dollar. Among Group-of-10 currencies, the Swedish krona, Norwegian krone and Australian dollar all advanced at least 1.1%.

Global equities have rebounded from a four-week low as riskier assets gained, after bookmakers’ odds suggested the chances of a “Leave” vote faded since the murder of a pro-European lawmaker on Thursday. A poll over the weekend showed 45% of voters backed the ‘Remain’ camp, while 42% were in favor of a so-called Brexit.

The MSCI All-Country World Index jumped 1.4% in New York, set for its biggest increase since March 17. The MSCI Emerging Markets Currency Index increased 0.8%, and a gauge of commodities advanced for a second day.

The Stoxx Europe 600 Index jumped 3.7%, for a second consecutive gain, with banks and financial-services companies among those leading the advance. All major western-European markets climbed, with the UK’s benchmark FTSE 100 Index adding 2.2%. The volume of Stoxx 600 shares changing hands was 35% higher than the 30-day average and a measure of euro-area volatility slid 9.5%, its biggest drop since March.

Futures on the S&P 500 climbed 1.3%, indicating US equities will rebound from the biggest weekly decline since April. The MSCI Emerging Markets Index of shares jumped 1.6%, the most in more than two months. Benchmarks in Poland and Hungary climbed at least 1.2%, while equities in Turkey gained 2.4%.

Stocks rose for a second day in Moscow, with Rosneft OJSC jumping 3.7% after two people familiar with the matter said Russia is seeking buyers for 19.5% of country’s biggest oil company.

 

Financialtribune.com