* Euro recovers after Greece's auction results
* World stocks gain on strong quarterly earnings hopes
By Dominic Lau
LONDON, July 13 (Reuters) - The euro recovered on Tuesday
after Greece successfully returned to capital markets for the
first time since late April, while global equities advanced
after Alcoa delivered a strong start to the earnings season.
Athens sold 1.625 billion euros ($2 billion) of six-month
Treasury bills, passing its first borrowing test since securing
a 110 billion euro EU/IMF emergency funding deal in May.
[]
"We were expecting a good result, and it's good for Greece
and the euro, but Greece has a long way to travel, as its
economic challenges are pretty severe," said Paul Robinson, FX
strategist at Barclays Capital.
"It's going to take years for Greece to figure this out, not
just one auction," he said.
The euro recouped earlier losses against the dollar <EUR=>
to trade steady at $1.2583, shrugging off Moody's Investors
Service's two-notch downgrade of Portugal's debt rating.
The impact of the downgrade to A1 was limited because rival
agency Standard & Poor's already rates Portugal a further two
notches lower, at A-minus. []
The dollar was down 0.3 percent at 88.41 yen <JPY=>. Against
a basket of major currencies, the greenback steadied. <.DXY>
[]
Bund futures <FGBLc1> extended losses after the Greek
auction results. The September contract was last 37 ticks lower
at 128.87.
However, Portugal's borrowing costs rose after the Moody's
downgrade. The Portuguese yield spread over Bunds <PT10YT=RR>
<DE10YT=RR> widened to 291 basis points, around 5 bps wider
compared with Monday's settlement close.
STOCKS HIGHER
World stocks measured by the MSCI All-Country World Index
<.MIWD00000PUS> rose 0.4 percent, helped by aluminium group
Alcoa's <AA.N> stronger-than-expected quarterly earnings.
Alcoa's results boded well for the U.S. earnings season and
offset concerns over China's growth after Beijing said it has no
plans to relax tougher property measures any time soon.
Beijing said it would continue to rein in speculation in the
country's booming property sector, dampening talk that it was
relaxing credit controls.
The comments weighed on Chinese stocks <> as well as
the Australian dollar <AUD=D4>, which is seen as a proxy of
Chinese growth.
In Europe, the FTSEurofirst 300 <> index gained 1.6
percent, also helped by rises in shares of oil major BP <BP.L>.
"What we have generally seen over the last few days are
traders betting that the U.S. earning season will be a fruitful
one and are therefore cherry picking stocks that to them may
look cheap," said Giles Watts, head of equities at City Index in
London.
U.S. stock index futures <SPc1> <DJc1> <NDc1> rose 0.5 to
0.7 percent, indicating a firmer start for Wall Street.
The MSCI All-Country World Index gained more than 5 percent
last week to post its best weekly rise in a year, though it is
still down 5.9 percent in 2010.
It carried a one-year forward price-to-earnings ratio of
11.13, falling to a level last seen in March 2009 and compared
with its 10-year average of 15.41, according to Thomson Reuters
DataStream.
Among the major U.S. companies to report results this week
include Intel <INTC.O>, JPMorgan Chase <JPM.N>, Citigroup <C.N>,
Bank of America <BAC.N> and General Electric <GE.N>.
(Additional reporting by Neal Armstrong, Will James and Jon
Hopkins; Editing by Ruth Pitchford)
