* U.S. stocks up for third straight session
* Brent crude jumps 7.2 pct, U.S. crude up 5.6 pct
* Fed policymakers discussed changing rate path -minutes
* Yen and U.S. Treasuries soften
* Peso firms after Mexican central bank raises rate
(Adds close of U.S. markets, Fed minutes)
By Chuck Mikolajczak
NEW YORK, Feb 17 (Reuters) - Global equity markets rallied
on Wednesday, as oil prices jumped on optimism that top crude
producers could finalize a deal to freeze production, while the
Mexican peso strengthened after the country's central bank hiked
its benchmark interest rate.
After a surprise agreement on Tuesday between non-OPEC
Russia and OPEC leader Saudi Arabia to freeze output at January
levels, Iran's oil minister on Wednesday met counterparts from
Venezuela, Iraq and Qatar, saying the proposed production
"ceiling" should be the first step toward stabilizing the
market.
Brent LCOc1 settled up 7.2 percent at $34.50 and U.S.
crude CLc1 was up 5.6 percent at $30.66 a barrel.
Energy .SPNY and materials .SPLRCM shares led Wall
Street higher, rising 2.9 percent and 2 percent, respectively.
Nine of the 10 major S&P sectors were in positive territory.
"Oil continues to directionally trade with equities and oil
prices are higher, and more important, economic data recently
has been better than feared," said Jason Ware, chief investment
officer at Albion Financial Group in Salt Lake City.
"Meanwhile, the backdrop for equities is oversold. ... This
has certainly compelled some folks who are under-invested to get
back into the stock market," he said.
The Dow Jones industrial average .DJI rose 255.37 points,
or 1.58 percent, to 16,451.78, the S&P 500 .SPX gained 31.02
points, or 1.64 percent, to 1,926.6 and the Nasdaq Composite
.IXIC added 98.11 points, or 2.21 percent, to 4,534.07.
The S&P 500 has climbed for three straight sessions, its
longest streak of the year, after closing at a two-year low on
Thursday. The 5.3 percent gain marks the best three-day
performance for the index since August.
The Mexican peso MXN= firmed 2.8 percent against the
dollar after Mexico's central bank unexpectedly raised its
benchmark interest rate by 50 basis points to 3.75 percent and
intervened directly in the foreign exchange market to sell
dollars as part of an aggressive new program in a major policy
shift to support the peso.
Economic data showed U.S. housing starts unexpectedly fell
in January but producer prices rose last month, with signs of an
uptick in underlying inflation, which is closely watched for
signs of when the Fed will raise rates.
In other data, industrial production in January rose by the
most in 14 months, its first increase in five months, the latest
sign the economy regained some ground early in the year.
Federal Reserve policymakers worried last month that tighter
global financial conditions could hit the U.S. economy and
considered changing their planned path of interest rate hikes in
2016, according to the minutes of the central bank's January
policy meeting.
In Europe, banks and resource stocks helped fuel a rally,
led by French bank Credit Agricole CAGR.PA and UK-listed miner
Glencore GLEN.L .
The pan-European FTSEurofirst 300 .FTEU3 index of leading
shares closed up 2.7 percent, bringing its gains for this week
to over 5 percent and putting it on track for its best week in
over five years.
Financials in Europe were up 3.3 percent .SX7P and basic
resources stocks surged 8.1 percent .SXPP .
MSCI's index of world shares .MIWD00000PUS was up 1.53
percent, extending Tuesday's rise of 2.3 percent, its
second-biggest gain in four years.
The dollar fell 0.17 percent against the yen JPY= , to
113.85 yen, while the benchmark 10-year U.S. Treasury
US10YT=RR was down 9/32 in price to yield 1.8086 percent
US10YT=RR .
Year-to-date asset performance http://fingfx.thomsonreuters.com/2014/05/01/1605285136.htm
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(Additonal reporting by Lewis Krauskopf; Editing by Leslie
Adler)