NEW YORK: Equities rose worldwide on Wednesday after a benign reading of US inflation and news that global regulators will delay stricter rules on banking capital, while oil rose on a sharp fall in US crude inventories.
Investors’ appetite for risky assets jumped but trading volumes remained low as they awaited a statement after the US Federal Reserve ends its last monetary policy meeting of 2009.
Shares of major Japanese banks surged and European bank shares rose 1.3 percent on relief that banks will have more time to adjust to new rules being drafted by the Basel Committee on Banking Supervision. US stocks rose after a moderate increase in consumer prices last month bolstered expectations the Fed would keep its accommodative monetary stance to foster growth. Sectors underpinning the advance of US stocks included energy, whose components jumped in sync with oil prices after data showed US crude inventories fell more than expected last week.
Before 1 p.m. (1800 GMT), the Dow Jones Industrial Average was up 28.50 points, or 0.27 percent, at 10,480.50. The Standard & Poor’s 500 Index was up 6.39 points, or 0.58 percent, at 1,114.32. The Nasdaq Composite Index was up 14.31 points, or 0.65 percent, at 2,215.36.
The dollar fell as traders’ inability to push the euro below $1.45 prompted traders to square positions ahead of the Fed statement later in the day.
The dollar was down against a basket of major currencies, with the US Dollar Index down 0.24 percent at 76.777. The euro rose 0.15 percent at $1.4555, and against the yen, the dollar was up 0.07 percent at 89.68.
The Nikkei share average closed at a seven-week high, up 0.9 percent, leading Asian stock markets on speculation banks may not have to raise more capital in the near term. The MSCI index of Asia Pacific stocks outside Japan was down 0.8 percent, weighed by the materials and consumer staples sectors.
Gold rose toward $1,140 an ounce as the euro hit session highs against the dollar as risk appetite sharpened.
Spot gold prices rose $11.00 to $1135.00 an ounce.
Meanwhile, world oil prices soared Wednesday as traders reacted to falling US heating fuel reserves and colder weather across the northern hemisphere, analysts said.
Brent North Sea crude for delivery in January jumped $1.69 to $73.74 a barrel in afternoon London trading, after hitting a peak of $73.86.
New York’s main futures contract, light sweet crude for January, leapt $2.36 to $73.05 a barrel, having earlier touched $73.37.
