Oil gains on Kuwait strike; global shares highest since December | Reuters - Firstpost
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Oil gains on Kuwait strike; global shares highest since December | Reuters

  Updated: Apr 20, 2016 01:30 IST

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NEW YORK Oil prices rose on Tuesday following a workers' strike in Kuwait, while a global stock index hit its highest level since early December as signs of economic stabilization in China lifted demand for riskier assets.

The rise in crude prices drove up the currencies of countries dependent on commodity exports, including Australia and Canada, where the local currency rose to 10-month and 9-month highs against the U.S. dollar, respectively.

Copper prices also jumped, and MSCI's emerging markets index .MSCIEF rose 1.28 percent.

MSCI's all-country world index .MIWD00000PUS, which tracks stock performance in 46 countries, gained 1.0 percent.

The pan-European FTSEurofirst 300 index .FTEU3 of leading regional shares closed up 1.5 percent. Stocks in Japan and China also ended higher.

"The predominant theme is risk on," said Richard Scalone, co-head of foreign exchange at TJM Brokerage in Chicago.

"We came into the year concerned about Chinese growth and an aggressive (Federal Reserve), and we've gotten nothing even remotely similar to where our fears were."

U.S. stocks were mixed. The S&P 500 edged closer to a record high in a choppy session marked by rising energy stocks and a solid quarterly report from pharmaceutical company Johnson & Johnson. J&J (JNJ.N) rose 1.3 percent to $112.41.

Technology shares fell, including a 12.3 percent drop in Netflix (NFLX.O) a day after the video-streaming service gave a disappointing growth outlook.

The Dow Jones industrial average .DJI rose 39.27 points, or 0.22 percent, to 18,043.43, and the S&P 500 .SPX gained 4.8 points, or 0.23 percent, to 2,099.14. The Nasdaq Composite .IXIC dropped 20.41 points, or 0.41 percent, to 4,939.60.

The rise in crude prices from below $30 a barrel in February and recent signs of steady economic growth in China, along with the U.S. Federal Reserve's cautious approach to raising interest rates, all have boosted stock prices in recent weeks.

Brent crude oil LCOc1 rose 2.6 percent to settle at $44.03 per barrel, while U.S. crude oil CLc1 gained 3.3 percent to settle at $41.08 per barrel.

The workers' strike in Kuwait cut production to 1.1 million barrels per day from 2.8 million in March and overshadowed the weekend failure by oil producers meeting in Doha to agree to freeze output. However, an official of the Kuwaiti state refiner said output would be restored in coming days.

The U.S. dollar hit 10-month lows against some commodity-related currencies and touched a nearly one-week low against the euro after weak U.S. housing data reinforced views of a dovish Fed.

U.S. housing starts fell more than expected in March and permits for future home construction hit a one-year low.

The Australian dollar AUD=D4 hit $0.7817, its highest level against the U.S. dollar since last June. The Canadian dollar rallied more than 1 percent to trade at $1.2637.

Brazil's currency, the real BRL=, gained 2.2 percent against the dollar. The real weakened on Monday after Brazil's central bank intervened to prevent it from rising sharply following a Congressional vote to impeach President Dilma Rousseff, an action which may result in a more market-friendly government.

Gold rose as the dollar weakened. Gold futures GCcv1 touched a one-week high of $1,253.20 an ounce. Copper CMCU3 was up 2.3 percent.

(Additional reporting by Sam Forgione in New York; Nigel Stephenson in London; Lisa Twaronite in Tokyo, Anirban Nag, John Geddie and Atul Prakash in London; Editing by Clive McKeef and Leslie Adler)

This story has not been edited by Firstpost staff and is generated by auto-feed.

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