World stocks, oil rise on outlook after U.S. data

By Herbert Lash

NEW YORK (BestGrowthStock) – Stocks rose and crude oil prices jumped to an 18-month high on Monday, propelled by hopes that the economic recovery is gaining momentum after U.S. homes sales and non-manufacturing data were better than expected.

Wall Street stocks added to gains, the U.S. dollar pared losses versus the yen, and prices of U.S. government debt briefly fell further after data showed the U.S. services sector in March grew at its fastest pace in nearly four years.

In addition, contracts for pending sales of previously owned homes unexpectedly rose in February, adding to hopes that recovery was gaining momentum in the housing market too after data last week showed U.S. employers created jobs at the fastest rate in three years.

“The momentum has started and it’s hard to derail. I think we are in good shape,” said Kurt Karl, chief U.S. economist at Swiss RE in New York about the services index from the Institute for Supply Management.

Friday’s good report on U.S. payrolls for March suggested that the U.S. labor market, key to a sustainable recovery, had finally turned the corner. Non-farm payrolls rose 162,000, only the third increase since the U.S. economy fell into recession in December 2007.

The Institute for Supply Management said on Monday its services index jumped to 55.4, its best reading since May 2006, while a survey from the National Association of Realtors showed its Pending Home Sales Index rose 8.2 percent to 97.6.

“The data is generally friendly but it’s not leading to another push higher given the fact that we’ve been moving higher for five consecutive weeks,” said Steve Goldman, equity market strategist at Weeden & Co in Greenwich, Connecticut.

MSCI’s all-country world index for equity markets (.MIWD00000PUS: ) rose 0.4 percent on a day many markets around the globe were closed for holidays.

Most European markets were closed, as well as markets in Australia, China, Hong Kong, Taiwan and New Zealand.

The Dow Jones industrial average (.DJI: ) was up 44.28 points, or 0.41 percent, at 10,971.35. The Standard & Poor’s 500 Index (.SPX: ) was up 6.60 points, or 0.56 percent, at 1,184.70. The Nasdaq Composite Index (.IXIC: ) was up 19.31 points, or 0.80 percent, at 2,421.93.

The U.S. dollar fell against euro and the yen as traders booked profits following a rally to more than seven-month highs earlier in the session.

The dollar was down 0.2 percent at 94.41 yen. It had earlier hit as high as 94.78 yen on electronic trading platform EBS, the highest since late August.

The euro rose 0.1 percent to $1.3517.

U.S. crude futures climbed over $86 a barrel on expectations that a faster-than-expected recovery would increase demand for fuel.

U.S. light sweet crude oil rose $1.25 to $86.12 a barrel.

Government debt prices fell. The benchmark 10-year U.S. Treasury note was down 8/32 in price to yield 3.97 percent, a level not seen since last June, when it hit 4.01 percent, according to Reuters data.

Spot gold prices rose $7.35 to $1127.30.

In Asia, stocks rose on news of last week’s U.S. jobs data.

Stock Market

(Reporting by Wanfeng Zhou, Ellen Freilich and Ellis Mnyandu in New York; Christopher Johnson in London; writing by Herbert Lash)

World stocks, oil rise on outlook after U.S. data