Equities surge on Fed cues; oil resumes decline
Reuters via Yahoo! Finance6 hours ago
Global equities markets rallied on Thursday,
with Wall Street surging nearly 2.5 percent, as investors buoyed by
policy comments from the U.S. Federal Reserve moved into riskier
holdings. The Swiss...
Thu, Dec 18, 2014, 11:51pm EST - US Markets are closed
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Equities surge on Fed cues; oil resumes decline
6 hours ago
People are reflected on an
electronic board displaying a graph showing the movement of Nikkei share
average outside a brokerage in Tokyo November 7, 2012. REUTERS/Toru
Hanai
The Swiss franc tumbled after the country's central bank announced a surprise charge on deposits, wary of a flood of money exiting Russia and likely inflows from the euro zone if the European Central Bank starts full-scale money printing early next year.
Wall Street powered higher, with the S&P 500 putting up its best two days of gains since November 2011, according to Reuters data. Health and technology shares were among the strongest U.S. sectors.(.SPLRCT) (.SPXHC)
"What
happened this week was a game-changer. That easy money trade came to
the forefront, and it's so powerful it wipes out all of these concerns
that exist," said Adam Sarhan, chief executive of Sarhan Capital in New
York.
The
dollar rose against major currencies, and world oil prices resumed a
months-long decline after Wednesday's rally, as asset manager Pimco said
cheap oil should help global economic growth next year.
U.S.
government debt, a traditional safe-haven for anxious investors,
dropped for a second day after the Fed's upbeat assessment of the U.S.
economy.The Fed's promise on Wednesday to take a "patient" approach to raising interest rates, while adding clarity on when it might raise rates, also helped boost European and Japanese shares.
Wall Street primary dealers, on average, expect the first rate hike to come in June 2015, according to a Reuters poll.
The
Dow Jones industrial average (.DJI) climbed 2.43 percent to 17,778.15
and the S&P 500 (.SPX) finished up 2.4 percent at 2,061.23 for its
biggest one-day percentage rise since January 2013. The Nasdaq Composite
Index (.IXIC) was up 104.08 points, or 2.24 percent, at 4,748.40. The MSCI world equity index , which tracks shares in 45 nations, rose 2 percent.
European
shares surged with a rise in Greek equities after the leader of the
country's main opposition party said he was committed to keeping Greece
in the euro zone should his leftist party take power next year.
The
FTSEurofirst 300 (.FTEU3) index of top European shares closed up 3
percent at 1,356.23, its biggest percentage rise since November 2011.
Oil
fell, with Brent crude (LCOc1) closing below the psychologically
significant $60 a barrel after peaking at $63.70. West Texas
Intermediate crude (CLc1) dropped 3 percent, or $1.65, to $54.82 a
barrel, after earlier gains drove it up to $58.73.
Pressure
on major oil-producer Russia's rouble remained as President Vladimir
Putin tried to cool worries of a financial crisis taking hold. At a news
conference, Putin sought to calm worries that the near-45 percent
plunge in the rouble since June has left Russia on the brink of a
full-blown crisis.
The
rouble was roughly 2.5 percent weaker on the day (RUB=), though
Moscow's dollar-traded stock market (.IRTS) jumped 6.5 percent.
U.S. Treasury yields rose, with the benchmark 10-year note down 17/32 in price to yield 2.21 percent. It reached a one-week high of 2.22 percent earlier on Thursday.
The
Swiss National Bank's move to introduce a charge on deposits was
accompanied by a cut in its main rate band. The franc fell to its lowest
level since mid-October against the euro and to a two-year low against
the dollar (CHF=).
The greenback was last at 0.9806 Swiss franc, and the dollar index (.DXY) was up 0.1 percent.
(Additional reporting by Richard Leong, Chuck Mikolajczak, Sam
Forgione, and Barani Krishnan in New York; Editing by Dan Grebler and
Leslie Adler)
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