NEW YORK The U.S. dollar fell on Wednesday on waning expectations of a near-term interest rate hike and an index of world equity markets advanced to a six-week high.
Commodities rallied on the weaker dollar and crude oil futures hit fresh 2016 highs on persistent worries related to supply outages.
The dollar fell to a five-week low against a basket of currencies as traders reduced bets of an imminent U.S. interest rate increase following a poor jobs report and perceived dovish comments from the Federal Reserve Chair Janet Yellen. The index .DXY was down 0.29 percent to 93.558.
The MSCI world equity index .MIWD00000PUS, which tracks shares in 45 nations, rose for its fifth straight session and was up 0.35 percent. Shares have rallied on buoyant crude oil prices and an upbeat assessment of the economy by Fed Chair Janet Yellen on Monday.
"A positive move develops its own momentum," said Bruce McCain, chief investment strategist at Key Private Bank in Cleveland.
"As we saw with the clearly disappointing jobs report, even some bad news is not enough to shake off the positive feeling that has been driving prices higher," he said.
Wall Street was higher in a narrow trading range, helped by commodity-sensitive industrial .SPLRCI and materials .SPLRCM stocks. The S&P 500 .SPX inched closer to its all-time high of 2134.72 touched in May last year.
"I think the good news for the market is that the sentiment is still far from euphoric. So if you have data just chug along and no major shocks, you could potentially have the market gap higher," said Marc Pouey, U.S. Equity and Quantitative Strategist at Bank of America in New York.
The Dow Jones industrial average .DJI was up 70.36 points, or 0.39 percent, at 18,008.64, the S&P 500 .SPX gained 7.83 points, or 0.37 percent, at 2,119.96 and the Nasdaq Composite .IXIC was up 15.78 points, or 0.32 percent, at 4,977.53.
Europe's broad FTSEurofirst 300 index .FTEU3 snapped two days of gains to close down 0.54 percent at 1,352.91. A drop in Italian bank UniCredit (CRDI.MI) and Austrian bank Erste (ERST.VI) knocked financial stocks.
Crude oil futures traded above the psychologically important $50 mark for the third consecutive day on supply worries related to sabotage of oil facilities in Nigeria.
Prices pared gains briefly as glut concerns resurfaced after U.S. data showed a surprise build in gasoline supplies.
Energy Information Administration data showed the U.S. crude oil inventories fell for the third consecutive week but gasoline and distillate stockpiles posted a surprise build as refiners ramped up output.
Brent crude LCOc1 settled up $1.07, or 2.08 percent at $52.51 a barrel, while U.S. crude CLc1 settled up 87 cents, or 1.73 percent, at $51.23.
In the bond market, U.S. 10-year Treasury yields fell to session lows after a solid 10-year note auction. The benchmark 10-year notes US10YT=RR were up 3/32 in price to yield 1.7022 percent, down from 1.713 percent late on Tuesday.
Investment funds, foreign central banks and other indirect bidders purchased a record share of the 10-year government debt issue at the auction, on intense overseas demand for higher-yielding U.S. bonds, Treasury data showed.
The weaker dollar helped boost copper and gold prices, while aluminium climbed to the highest levels in nearly a month.
Spot gold XAU= rose more than one percent to a near three-week high and was up 1.39 percent to $1,260.67 an ounce.
(Additional reporting by Karen Brettell in New York; Editing by Nick Zieminski)
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