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GLOBAL MARKETS-Equities advance as weaker dollar boosts oil

Published 2016-02-04, 11:21 a/m
© Reuters.  GLOBAL MARKETS-Equities advance as weaker dollar boosts oil
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* Europe shares rise, but Credit Suisse caps gains
* Dollar falls further vs major currencies
* Materials, energy lead U.S. stocks higher

(Adds open of U.S. markets, byline, dateline; previous LONDON)
By Chuck Mikolajczak
NEW YORK, Feb 4 (Reuters) - Global equity markets rose on
Thursday, as the dollar continued to weaken on diminished
expectations of U.S. interest rate hikes this year, which in
turned boosted the prices of oil and other commodities.
The dollar .DXY fell for a fourth day on the latest batch
of soft U.S. data, while comments from a U.S. Federal Reserve
policymaker on Wednesday were viewed as a sign further rate
hikes could be delayed.
Dollar weakness, and unconfirmed talk that oil-producing
countries in and outside the OPEC group may meet soon to discuss
output cuts to help relieve a global supply glut, helped crude
prices add to Wednesday's sharp gains.
"Obviously, there is concern about the Fed and what they are
going to do with rates, but oil is number one at this point
because we are starting to see the effect of lower oil," said
Ian Kerrigan, global investment specialist at JPMorgan (N:JPM) Private
Bank in Seattle.
"It's the top priority of the markets right now, on a
day-to-day basis."
The U.S. currency fell 0.7 percent against a basket of major
currencies .DXY on Thursday and is down 3 percent for the
week, on pace for its worst week since May 2009. It hit a 3-1/2
month low against the euro EUR= and held close to a two-week
low against the Japanese yen JPY= .
Brent, the global benchmark LCOc1 , was down 0.8 percent at
$34.77 a barrel, after hitting a high of $35.84 earlier in the
day, while U.S. crude CLc1 was up 0.76 percent at $32.46.
The fall in the dollar also helped push metals higher, with
copper CMCU3 and zinc CMZN3 both up more than 1.5 percent.
In turn, that lifted emerging markets, whose economies are
highly depending on commodities. The MSCI emerging markets index
.MSCIEF climbed 3 percent.
Commodity-related shares pushed higher in Europe, although
gains were capped by a decline of more than 11 percent in Credit
Suisse CSGN.VX , with the pan-European FTSEurofirst 300 index
.FTEU3 rising 0.35 percent. The STOXX Europe 600 Basic
Resources Index .SXPP surged 8.4 percent and the oil and gas
index .SXEP jumped 4.2 percent.
On Wall Street, the Dow Jones industrial average .DJI rose
112.38 points, or 0.69 percent, to 16,449.04, the S&P 500 .SPX
gained 10.13 points, or 0.53 percent, to 1,922.66 and the Nasdaq
Composite .IXIC added 24.11 points, or 0.54 percent, to
4,528.35.
Those gains were led by a 3.1 percent climb in the materials
sector .SPLRCM while the energy sector .SPNY advanced 1.2
percent. The MSCI World equity index .MIWD00000PUS was up 1.1
percent.
Stocks globally have had a dismal start to 2016, smacked by
tepid U.S. growth, falling oil prices, and concern the world
faces a China-led slowdown.
However, another potential worry, that the U.S. Federal
Reserve would stay on course for four interest rate hikes in
2016, has eased somewhat.
Fed policymaker William Dudley told Market News
International in an interview published on Wednesday that
monetary conditions had tightened since the Fed raised rates on
Dec. 3. and rate-setters would have to take this into account.
Ten-year U.S. Treasury yields US10YT=RR edged down 1/32
basis point to 1.886 percent.
Gold XAU= , was last up 0.7 percent at $1,150.96 after
hitting a three-month high at $1,156.60 an ounce.

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