Oil turns higher, pushes world stock markets up | Reuters - Firstpost
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Oil turns higher, pushes world stock markets up | Reuters

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NEW YORK Global equity markets got a boost from an upturn in crude oil on Thursday as the market focused on an upcoming meeting of major oil producers that investors hope could stabilise volatile petroleum markets.

U.S. stock indexes were also buoyed by robust data on durable goods orders that pointed to a recovery in the struggling manufacturing sector.

The Dow Jones industrial average rose 212.37 points, or 1.29 percent, to 16,697.36, the S&P 500 gained 21.93 points, or 1.14 percent, to 1,951.73 and the Nasdaq Composite added 39.60 points, or 0.87 percent, to 4,582.21.

Crude oil futures rose more than 2 percent after Venezuela reaffirmed an oil producers meeting in mid-March that would include Saudi Arabia, Russia and Qatar. Prior to the announcement, oil was down as much as 3 percent.

The sharp turn was more of "an emotional move, people thinking they're going to miss the boat," said Michael Matousek, head trader at U.S. Global Investors Inc in San Antonio, about the gains in oil.

"People are trying to stay one step ahead, thinking they know what the decision of OPEC will be."

U.S. crude futures settled up 92 cents, or 2.9 percent, at $33.07 a barrel.

Brent crude futures finished up 88 cents, or 2.6 percent, at $35.29 a barrel, hitting a three-week high.

European equity markets rose Thursday, rebounding from this week's losses that had been spurred by fears of Britain exiting the European Union.

Europe's FTSEurofirst 300, which has lost almost 4 percent since Tuesday, was up 2 percent as risk appetite returned.

Equity markets and oil prices have moved in sync this year so far, but analysts say they expect the two to decouple in the not-too-distant future.

MSCI's gauge of global stock markets was up 1.1 percent.

Markets' appetite for risk pushed traders out of safe-haven currencies like the Japanese yen, which fell 0.6 percent against the dollar.

Britain's sterling rose 0.3 percent to $1.3970, taking a breath from a 5-percent fall since early this month on fears that a public vote on June 23 could see Britain become the first country to quit the 28-member European Union.

The dollar struggled to make much headway overall due to doubts over whether the Fed will raise rates at all this year. The euro edged up 0.15 percent to $1.1027. The dollar index, which measures the greenback against six major currencies was flat on the day.

Oil's recovery Thursday did help increase U.S. bond market's gauges on traders' inflation expectations to their highest levels in nearly four weeks.

Federal Reserve policymakers have been concerned about the erosion in inflation expectations which could impair efforts to boost domestic price growth to their 2-percent goal.

The yield premiums on regular U.S. Treasuries over Treasury Inflation Protected Securities, known as inflation breakeven rates, have risen from their lowest levels since early 2009 in recent days with the rebound in oil prices.

(Additional reporting by David Gaffen in New York, Marc Jones in London, Joshua Hunt in Tokyo; Editing by Bernadette Baum and Nick Zieminski)

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

First Published On : Feb 26, 2016 04:15 IST

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