0 comments

GLOBAL MARKETS-Shares, euro fly on Greek deal hopes, German data

by on November 23, 2012 4:20 pm GMT
 

Fri Nov 23, 2012 11:20am EST

* Wall St jumps on hopes for Greece, retail in focus

* Euro hits 3-week high on optimism about a Greek deal

* World shares headed for their best week since mid-Sept

By Angela Moon

NEW YORK, Nov 23 (Reuters) – Global stocks and the euro
climbed on Friday on signs of progress in talks about releasing
aid to Greece and an influential German survey that found
business sentiment had improved in Europe’s largest economy.

The three major U.S. stock indexes rose about 1 percent,
buoyed by bellwether technology stocks such as Intel
and Microsoft – each up more than 2 percent. An index
of semiconductor stocks gained 2.1 percent, while the S&P
information technology sector index rose 1.3UK percent.

Friday marked the start of the holiday shopping season and
gave investors a reason to scoop up retailers’ shares on hopes
that consumers will go out en masse to spend.

Regular U.S. stock trading session will end early on Friday
at 1 p.m. (1800 GMT). The stock market was closed on Thursday
for the Thanksgiving holiday. With many investors away on
holiday, volume was low. About 1.2 billion shares have traded so
far on the New York Stock Exchange, the Nasdaq and the NYSE MKT,
compared with the daily average for the year to date of 6.5
billion.

The Dow Jones industrial average was up 117.64
points, or 0.92 percent, at 12,954.53. The Standard & Poor’s 500
Index was up 12.61 points, or 0.91 percent, at 1,403.64.
The Nasdaq Composite Index was up 31.30 points, or 1.07
percent, at 2,957.86.

The euro rose as high as $1.2943 on Reuters data,
breaking above resistance at $1.2910, its 55-day moving average.
It was last trading at $1.2941, up 0.5 percent on the day.

Against the yen, the euro also hit a seven-month high of
106.73 yen and was last at 106.65 yen, up 0.4 percent.

MSCI’s world equity index was up 0.9 percent
on Friday at 329.12 points. It was on track to its best weekly
performance since mid-September.

Earlier, MSCI’s broadest index of Asia Pacific shares
outside Japan rose 0.7 percent for a weekly gain
of 2.6 percent, also its best week for two months.

Optimism about a deal to help Greece, hopes that United
States lawmakers can agree on a solution to avoid a fiscal
crisis, and data showing an improving global economic outlook
have driven a rally in riskier asset markets this week.

Greece said the International Monetary Fund had relaxed its
debt-cutting target for the country, suggesting lenders were
closer to a deal for a vital aid tranche to be paid. But other
sources involved in the talks cautioned that the funding gap was
far bigger than Greece has suggested.

Euro-zone finance ministers, the IMF and the European
Central Bank (ECB) failed earlier this week to agree on how to
get the country’s debt down to a sustainable level. They will
make a third attempt at resolving the issue on Monday.

“Anything positive out of Europe related to the sovereign
debt … that can act as a catalyst,” said Todd Salamone,
director of research at Schaeffer’s Investment Research in
Cincinnati.

The S&P 500 looked likely to break a two-week losing streak,
having gained more than 3 percent this week so far. Stocks had
tumbled earlier in the month on worries about the impact of
mandatory tax and spending changes to take effect in early
January, but hopes that politicians will reach a deal to avoid
the “fiscal cliff” helped the market recoup some of those losses
this week.

The benchmark S&P 500 also climbed back above the 1,400
level, which could provide support.

COMMODITIES MIXED

Gold rose nearly 1 percent to its highest level in more than
a month, buoyed by U.S. equities’ gain and technical buying as
the metal breached its 50-day moving average.

Spot gold was up 0.9 percent at $1,743.86 an ounce by
10:22 a.m. EST (1522 GMT), after it hit $1,747 – which marked
the loftiest price since Oct. 18.

Oil rose above $111 a barrel on Friday as
better-than-expected German business sentiment data helped ease
worries about demand in the euro-zone economies, boosting the
euro against the dollar, while fresh protests broke out in
Egypt.

Brent crude futures were up 80 cents at $111.38 a
barrel at 1526 GMT. U.S. crude was up 94 cents at $88.32.
The U.S. market, which was closed on Thursday for the
Thanksgiving holiday, will not issue a formal settlement price
until later Friday.

On Thursday, Israel began withdrawing its army, which had
been poised to invade the Gaza Strip in pursuit of militants
firing rockets into Israel.

“Oil prices will probably be under pressure as long as the
ceasefire holds,” said Filip Petersson, a commodity strategist
at SEB Commodity Research.