By Natsuko Waki
LONDON, April 15 (Reuters) - World stocks rose from this
week's two-week trough on Tuesday as soaring oil, rice and other
commodity prices boosted resource-related shares, while sterling
hit record lows versus the euro after weak British housing data.
U.S. light crude rose as high as $112.48 a barrel <CLc1> due
to supply disruptions in Mexico. U.S. rice futures <RRN8> rose
to an all-time high, extending this year's increase to more than
60 percent, while corn <CK8> kept within sight of a recent
record. Gold also extended gains <XAU=>.
Firmer energy and commodity prices reflect resilience of
emerging economies at a time when developed country economies
are suffering from the effects of the credit crisis which has
spooked global financial markets since August.
Evidence is piling up that major economies are slowing down.
In Britain, a survey showed house price balance fell in March to
its lowest since 1978. Separately, British like-for-like retail
sales fell in March for the first time in two years at the
sharpest pace in nearly three years.
"This is a clear signal that things in the housing market
are getting worse," said Ian Stannard, senior FX strategist at
BNP Paribas.
"It looks like we're going to see not only the housing
market continue to deteriorate but also the negative knock-on
effect into the consumer sector as well."
The FTSEurofirst 300 index <> was up 0.2 percent while
MSCI main world equity index <.MIWD00000PUS> was also up 0.2
percent, off Monday's two-week low. Oil and gas shares were the
best performers in Europe, rising 1.5 percent <.SXEP>.
Britain's Tesco <TSCO.L>, the world's third-biggest
retailer, reported an 11 percent rise in annual profits, sending
its shares up 4 percent.
However, sterling fell to all-time lows of 80.46 pence per
euro <EURGBP=> and matched last week's 11-1/2 year low on the
trade-weighted index <=GBP> after the housing and retail sales
surveys.
European credit spreads moved a touch tighter, with the
iTraxx Crossover index <ITCRS5EA=GFI>, most-widely watched
indicator for European credit market sentiment, hitting 527
basis points.
Emerging sovereign spreads <11EMJ> tightened 2 bps while
emerging stocks <.MSCIEF> rose 0.2 percent.
The June Bund future <FGBLM8> was down 0.1 percent as
investors sold safe-haven bonds to move into stocks.
EARNINGS RUSH
This week brings a rush of first-quarter earnings from major
economies.
U.S. firms reporting their Q1 results later include Intel
<INTC.O>, State Street <STT.N>, Washington Mutual <WM.N> and
Northern Trust <NTRS.O>.
An expected quarterly loss from Wachovia Corp <WB.N> on
Monday raised concerns about the health of banks hit by their
investment in risky U.S. subprime mortgages.
However, earnings results from banks -- many of them pretty
weak -- have so far helped improve investor sentiment that banks
are scrubbing their books clean, putting the credit crunch
behind them.
However, earnings reports from industrial companies -- last
week's General Electric <GE.N> for instance -- have fanned
concerns that the eight-month-old credit crisis is now hitting
the real economy hard.
Moreover, further evidence of increasing price pressures
from rising commodity prices could discourage the world's
central banks from cutting interest rates aggressively to ease
effects from the credit crisis.
(Additional reporting by Naomi Tajitsu; Editing by Gerrard
Raven)
