March 1, 2012 / 10:26 PM / 5 years ago

GLOBAL MARKETS-Stocks, oil rise on data, ECB cash injection

 (Adds close of U.S. markets)	
 * U.S. stocks advance, data feeds momentum
 * ECB cash injection lifts sentiment, boosts banks
 * U.S. data, while tepid, gives fresh encouragement
 * Brent crude jumps  to over $126 on Israeli missle news
 By Herbert Lash	
 NEW YORK, March 1 (Reuters) - Global stocks rose on
Thursday as investors focused on an improving U.S. labor market
and other data in hopes the rally would advance further, while
crude oil surged on news that Israel would soon test-fire a
ballistic interceptor missile.	
 The European Central Bank's second massive injection of cash
also buoyed sentiment in equity markets, lifting European shares
more than 1 percent and removing the fear of a meltdown in the
banking sector that had cast a pall over markets. 	
 "They are on the right road, which means that the risks
associated with Europe are starting to abate. And that's really
good news," said Hugh Johnson, chief investment officer of Hugh
Johnson Advisors LLC in Albany, New York.	
 U.S. stocks recouped losses from Wednesday after the latest
data on jobless claims bolstered views of an improving American
labor market and solid monthly sales from retailers fed investor
sentiment.	
 However, gains were muted due to fears that other data
signaling slower growth will prevent this year's rally, which
has pushed major stock indexes to multi-year highs, from
climbing much further. 	
 U.S. manufacturing unexpectedly cooled in February and
consumer spending was flat in January for a third straight month
after accounting for inflation, casting doubts on the strength
of the recovery. 	
 In oil markets, Brent crude rose above $126 a barrel on the
Israeli announcement and as data indicating strength in the U.S.
economy and Chinese data showing stronger-than-expected factory
growth in February drove expectations of strong demand for oil.	
 The ongoing concerns about disruptions of Iranian oil
supplies -- already being reduced in the wake of Western
sanctions against Tehran for its disputed nuclear program -- 
added support. 	
 Brent crude surged 2.9 percent to settle up $3.54 at
$126.20 a barrel after hitting an intra-day high of $128.40.
U.S. oil settled up $1.77 at $108.84 per barrel.	
 On Wall Street, investors said the 13,000 level on the Dow,
which was breached on Monday for the first time since
May 2008, represented a major psychological barrier for stocks.	
 "A lot of the guys on the floor are sensing -- barring some
significant event, whether that be geopolitical or relating to
the European debt crisis -- we could potentially at some point
just explode through," said Gordon Charlop, managing director at
Rosenblatt Securities in New York.	
 The Dow Jones industrial average closed up 28.23
points, or 0.22 percent, at 12,980.30. The Standard & Poor's 500
Index  rose 8.41 points, or 0.62 percent, at 1,374.09.
The Nasdaq Composite Index added 22.08 points, or 0.74
percent, at 2,988.97. 	
 Major U.S. automakers' posting stronger sales in February
also supported Thursday's gains. 	
 Shares of Ford Motor Co rose 2.3 percent and shares of
General Motors rose 1.7 percent.	
 Euro zone bank shares rose 2.6 percent after French
and Spanish government borrowing costs fell at auctions and
yields on Italian notes dropped on the secondary market, 
following the ECB's cash injection on Wednesday.
  	
 Italian banks, which own the lion's share of the country's
debt, led gainers, with Banco Popolare rising 10.5
percent and UniCredit up 5.8 percent.  	
 The FTSEurofirst 300 index of top European shares
ended 1.1 percent higher at 1,086.72. 	
 "The funding risk in the banking system has reduced
substantially," said Dennis Jose, strategist at Barclays
Capital. "The risk of the sovereign having to eventually bail
out the banks has also reduced" with the ECB's liquidity
measure.	
 But gains were limited as benchmark indexes in Europe and on
Wall Street failed to convincingly break above major resistance
levels as a brisk 2-1/2-month rally loses steam.	
 The euro fell slightly in volatile trading after hitting a
one-week low on initial concerns over U.S. economic data.	
 The euro slipped 0.1 percent to $1.3309.	
 Remarks by Federal Reserve Chairman Ben Bernanke had little
impact on the market. Bernanke said he was worried that the
rapid decline in U.S. unemployment may not be sustained. 	
 Bernanke's prepared remarks on Thursday were
mostly a repeat of the prior day's testimony, when he stopped
short of signaling a further easing of monetary policy, which
some in the market had expected.	
 The euro had been weak before New York opened, after the
ECB's huge cash injection reminded investors of the region's
debt overhang and the fragile euro zone economy. 	
 U.S. Treasury debt prices fell as some investors pushed back
the timing of another potential round of Fed easing, and riskier
assets did better at the expense of safe-haven U.S. debt.	
 U.S. Treasuries prices briefly pared early losses after the
Institute for Supply Management said its index of U.S. factory
activity fell to 52.4 from 54.1. The reading was shy of
expectations of 54.5, according to a Reuters poll of economists.
A reading above the 50 mark indicates expansion.	
 Benchmark 10-year notes were off 17/32 in price
to yield 2.03 percent.	
  

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