December 17, 2014 / 5:01 PM / 3 years ago

GLOBAL MARKETS-Equities gain as oil prices rebound, and safety bid eases

(Updates with U.S. markets, rouble reversing decline against dollar; changes byline; dateline previously LONDON)

* Wall Street rises after string of losses

* Rouble up against the dollar

* Brent inches over $60 a barrel

By Michael Connor

NEW YORK, Dec 17 (Reuters) - Global markets stabilized on Wednesday, with U.S. and European equities rebounding as a comeback in oil prices drove up energy shares.

The yield on U.S. five-year Treasuries climbed to session highs as the gains on Wall Street and domestic oil futures pared safe-haven buying that has been fueled by the deepening economic crisis in Russia.

The dollar pulled back from recent gains against the Russian rouble, which has been hammered due to worries about increased U.S. sanctions and the effect of lower oil prices on Russia’s struggling economy. The dollar of late bought 61.7 roubles, down nearly 10 percent on the day.

Investors were looking ahead to the U.S. Federal Reserve’s final policy statement of 2014, due at 2 p.m. (1900 GMT). In a sign of America’s brightening economic outlook, many analysts expect the Fed to remove language pledging to wait a “considerable time” before raising U.S. interest rates.

“The market is preparing itself for a change in the Fed language,” said currency strategist Mark McCormick of Credit Agricole in New York.

The dollar recovered ground against the yen after data showed Japanese exports rose less-than-expected in November. A dollar index was up 0.4 percent.

Oil prices moved above $60 a barrel as U.S. data showed falling crude inventories, stemming deep losses brought on by a supply glut and signals from OPEC producers and Russia that they will not cut production. Brent crude was up 41 cents to $60.42 a barrel.

Wall Street’s Dow Jones industrial average was up 0.92 percent, and the S&P 500 gained 1.2 percent to 1,996.70 after three days of losses.

The S&P energy index was up 4.4 percent.

The MSCI world equity index, which tracks shares in 45 nations, was up 0.19 percent to 403.97 after posting losses earlier in the trading day.

The pan-European FTSEurofirst 300 index, which had spent much of the day in negative territory, was up 0.2 percent, while the euro zone’s blue-chip Euro STOXX 50 index rose 0.1 percent.

U.S. Treasuries prices slipped. The 10-year note fell 9/32 to yield 2.099 percent. The yield on the five-year notes was last 1.567 percent, up 4 basis points from Tuesday’s close after it hit a session peak of 1.571 percent earlier Wednesday.

The global economy is ending the year in a fragile state, with weak growth in Europe and Japan and slowing demand in China.

U.S. consumer prices recorded their biggest drop in nearly six years in November as gasoline prices tumbled, according to government data.

One of the European Central Bank’s favored measures of longer-term inflation expectations fell below 1.60 percent for the first time, after data confirmed falling prices of fuel and heating oil helped keep euro zone inflation low in November.

German bund yields, which set the standard for euro zone borrowing costs, held near record lows reached on Tuesday.

The Russian rouble rose on Wednesday after the Finance Ministry said it had begun selling foreign currency. The rouble at one point on Tuesday had been down around 20 percent against the dollar, despite the central bank increasing its key interest rate by an unexpected 650 basis points.

Russian shares were mixed, with the dollar-denominated RTS index up 6.5 percent, the first daily gains after a nine-day losing streak, while the rouble-based peer MICEX traded 0.6 percent lower. (Reporting by Michael Connor in New York; Editing by Leslie Adler)

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