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GLOBAL MARKETS-Oil, stocks surge as relief rally trumps caution

Published 2016-02-17, 07:46 a/m
© Reuters.  GLOBAL MARKETS-Oil, stocks surge as relief rally trumps caution
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* European stocks, oil drive risk rally
* Credit Agricole , Glencore the big movers
* US futures point to higher open

By Jamie McGeever
LONDON, Feb 17 (Reuters) - Oil and stocks jumped on
Wednesday, as European earnings and hope that top oil producers
will convince Iran to agree to a production freeze overcame
initial caution in Europe.
Banks and resources stocks led the way, with French bank
Credit Agricole CAGR.PA soaring 12 percent after publishing
its latest results and UK-listed miner Glencore GLEN.L up 10
percent after announcing the refinancing of its debt.
Investors' appetite for risk eventually seeped through to
currencies and fixed income markets, where safe-haven assets
like the Japanese yen and government bonds gave back their
initial gains, and gold also eased back from its earlier high.
"It's a correction in oil. The recovery may not last but
it's giving a boost to stocks," said Ipek Ozkardeskaya, market
strategist at London Capital Group.
"But these levels of price swings on both sides, up and
down, is a bad sign. There's no clear visibility on direction.
We're still in a world where investors aren't really sure where
to put money," she said.
The pan-European FTSEurofirst 300 index of leading shares
was last up 1.6 percent, bringing its gains for this week to 4
percent and putting it on track for its best week over in three
months.
Financials were up 2 percent .SX7P and basic resources
stocks were up 4 percent .SXPP .
Britain's FTSE .FTSE was up 1.5 percent, Germany's DAX
.GDAXI was up 1.7 percent and France's CAC 40 .FCHI rose 2
percent.
Earlier, MSCI's broadest index of Asia-Pacific shares
outside Japan .MIAPJ0000PUS lost 0.4 percent, reversing early
gains of 0.4 percent, after a 3 percent rise over the previous
two sessions.
The Shanghai Composite Index .SSEC rose 1 percent and
Japan's Nikkei .N225 fell 1.4 percent but is still up more
than 5 percent on the week.
MSCI's index of world shares .MIWD00000PUS was up 0.2
percent, extending Tuesday's rise of 2.3 percent, its
second-best gain in four years.
E-Mini futures for the S&P 500 ESc1 rose 0.7 percent. The
S&P 500 .SPX added 1.65 percent on Tuesday, the Dow .DJI
ended up 1.39 percent and the Nasdaq .IXIC up 2.27 percent.
.N

CRUDE AWAKENING
Investors are closely watching how a proposal from top
exporters Russia and Saudi Arabia to freeze output is greeted in
Iran, which was absent from the talks and is determined to raise
production.
Iranian Oil Minister Bijan Zanganeh is meeting his
counterparts from Venezuela, Iraq and Qatar in Tehran on
Wednesday. An Iranian official earlier said Iran would continue
increasing its crude output until it reached levels seen before
the imposition of international sanctions. ID:nL8N15W0KN
Oil recovered from early losses and in early European trade
on Wednesday Brent LCOc1 was up 2.8 percent at $33.05. U.S.
crude CLc1 was up 1.9 percent at $29.58 a barrel.
Markets are also awaiting minutes of the Federal Reserve's
last meeting to judge views of policymakers on the prospect of
further rate hikes.
Boston Fed President Eric Rosengren sounded in no hurry to
tighten. Speaking on Tuesday, Rosengren said the Fed would need
to lower economic forecasts it made in December because of the
uncertain global outlook
Doubts about the pace of any further rate increases held
back the U.S. dollar at 96.85 .DXY against a basket of
currencies. It was flat against the yen at 114.05 yen JPY= ,
while the euro erased its earlier gains to trade flat on the day
at $1.1145 EUR= .
Sterling, which has struggled so far in 2016 because of
worries Britain might leave the European Union, recovered after
figures showed UK employment rose to its highest level ever and
the claimant count for jobless claims hit a 40-year low.
ID:nL9N0MN00B
On Thursday, Prime Minister David Cameron will try to
persuade other leaders to support an agreement to keep Britain
in the EU.
"We do not expect any further negative reaction to be hefty
or long-lasting as investors are unlikely to remain too much
positioned ahead of the start of the key EU summit tomorrow,"
wrote Unicredit (MI:CRDI) currency strategists in a note on Wednesday.
Sterling GBP= was last flat on the day at $1.43 GBP= ,
recovering around half a cent after the jobs data.
In bond markets the benchmark 10-year U.S. Treasury yield
was up one basis point at 1.79 percent US10YT=RR and the
10-year Bund yield was up a basis point too at 0.27 percent
EU10YT=RR .
Gold was on track to snap a three-day losing streak, up 0.4
percent on the day at $1,205 an ounce but off its high XAU= .

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Shanghai CSI 300 and global effects interactive https://t.co/YqIYLIbInP
Chinese A-shares vs developed and emerging stocks http://link.reuters.com/rac25w
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