Stocks

World stock markets up; fall in inventories lifts oil

Reuters New York | Updated on January 20, 2018 Published on May 26, 2016

global

Oil prices climbed to just shy of $50 a barrel on Wednesday after a sharper-than-expected fall in crude inventories, lifting energy shares and world stock markets.

Growing bets on a possible Federal Reserve rate increase as early as in June or July reduced demand for US government debt.

Fed policy minutes

Investors' expectations for higher borrowing costs have risen since last week's minutes from the central bank's April meeting signaled a June increase was on the table. Comments from policymakers and upbeat US economic data in recent days have supported those views.

“What you're seeing is a recognition that this is going to happen and investors are getting more comfortable with it,” said Kurt Brunner, a portfolio manager at Swarthmore Group in Philadelphia. “There's a recognition that economic growth is okay.”

US crude stockpiles

Energy Information Administration data showed US crude stockpiles fell last week as imports dropped and refineries cut output. Brent settled up $1.13 at $49.74, while US crude's settled 94 cents higher at $49.56.

World stocks markets rose for a second straight session, helped by energy shares, including Chevron, up 1.6 per cent, and bank shares, which benefit from higher interest rates.

The Dow Jones industrial average closed up 145.46 points, or 0.82 per cent, to 17,851.51, the S&P 500 gained 14.48 points, or 0.7 per cent, to 2,090.54 and the Nasdaq Composite added 33.84 points, or 0.7 per cent, to 4,894.89.

Combining Tuesday and Wednesday's performances, the S&P 500 gained 2 per cent, its strongest two-day run since early March.

MSCI's all-country world stock index rose 0.9 per cent, while the pan-European FTSEurofirst 300 index of leading regional stocks ended up 1.3 per cent, touching its highest level since late April.

Greece debt deal

Banks in Europe were buoyed after a new debt deal for Greece seemed to head off the risk of another round of uncertainty over its finances and even its future in the euro zone.

US Treasury prices fell, with short- and medium-dated yields hitting 10-week highs, helped by the solid advance in Wall Street stocks.

Early in the US session, the two-year yield and five-year yield reached 10-week highs at 0.938 per cent and 1.424 per cent, respectively.

Dollar, euro

The US dollar fell from near a 10-week high against the euro and rose just slightly against the yen as investors took profits on the greenback's recent gains.

The euro was last up 0.17 per cent against the dollar at $1.1161, while the dollar was last up just 0.11 per cent against the yen at 110.10 yen.

Yellen's speech

Investors await Fed Chair Janet Yellen's appearance at a panel at Harvard University on Friday, the same day as they take in a revised estimate of US first-quarter growth.

Gold dropped to a seven-week low amid the Fed expectations. Spot gold was down 0.2 per cent at $1,223.93 an ounce, off an earlier low of $1,217.25, the lowest since April 6.

Published on May 26, 2016

A letter from the Editor


Dear Readers,

The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.

Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.

In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.

We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.

But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.

I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.

A little help from you can make a huge difference to the cause of quality journalism!

Support Quality Journalism
null
This article is closed for comments.
Please Email the Editor
You have read 1 out of 3 free articles for this week. For full access, please subscribe and get unlimited access to all sections.