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GLOBAL MARKETS-Oil rallies on OPEC output deal; energy stocks lift Wall St

Published 2016-09-28, 03:29 p/m
© Reuters.  GLOBAL MARKETS-Oil rallies on OPEC output deal; energy stocks lift Wall St
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* Crude prices rally the most since early Feb after output deal

* Deutsche Bank rebounds, helps lift European shares (Updates throughout, adds comments, byline)

By Rodrigo Campos

NEW YORK, Sept 28 (Reuters) - Oil prices rallied on Wednesday after OPEC members reached an agreement on a production-limiting deal, boosting energy sector shares.

The U.S. dollar was flat versus a currency basket but fell to a near-five month low versus the Norwegian krone NOK= . Norway, although not an OPEC member, is a major crude producer.

Crude oil prices jumped after sources told Reuters that the Organization of the Petroleum Exporting Countries agreed to reduce its oil output by about a million barrels per day. crude CLc1 was up 5.2 percent on the day. move in oil boosted shares in the energy sector of the S&P 500, giving direction to Wall Street indexes that had previously see-sawed near the unchanged line. could potentially be very significant, not for the barrels that could be removed from the market, but because it's a signal that the Saudis could be returning to active supply management. That's the bottom line," said Michael Wittner, global head of oil research at Societe Generale (PA:SOGN) in New York.

"It remains to be seen how many real barrels will be removed from the market. To me, the significance is way beyond that: they all sat down in a room and made a decision."

The near 4-percent gain in the S&P energy stocks .SPNY was on track to be the largest for any day since at least early February.

The Dow Jones industrial average .DJI rose 82.46 points, or 0.45 percent, to 18,310.76, the S&P 500 .SPX gained 7.6 points, or 0.35 percent, to 2,167.53 and the Nasdaq Composite .IXIC added 5.97 points, or 0.11 percent, to 5,311.68.

Commodity shares led European stocks higher while Deutsche Bank DBKGn.DE recovered from all-time lows hit in the previous session. The pan-European FTSEurofirst 300 index .FTEU3 ended up 0.69 percent. biggest lender faces big fines over claims it mis-sold mortgage-backed securities and, like other euro zone lenders, has been squeezed by the ECB's negative rate policy.

MSCI's gauge of stocks across the globe .MIWD00000PUS rose 0.3 percent, boosted by Wall Street.

U.S. Treasury yields were little changed. Benchmark 10-year notes US10YT=RR fell 3/32 in price to yield 1.5685 percent, up from 1.556 percent on Tuesday. gold prices XAU= fell $4.69 or 0.4 percent, to $1,322.35 an ounce. (Additonal reporting by Barani Krishnan, Gertrude Chavez-Dreyfuss and Sam Forgione; Editing by Nick Zieminski)

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