GLOBAL MARKETS-Stocks rise on data; euro off before ECB meet

Wed Mar 6, 2013 4:27pm EST

* U.S. crude oil briefly dips below $90
    * MSCI world share index just under June 2008 high
    * Yen hits week low versus greenback


    By Rodrigo Campos
    NEW YORK, March 6 (Reuters) - The blue-chip Dow Jones index
extended its record-breaking run on Wednesday and world stock
markets edged higher, led by strong gains in Asia, while the
euro slid against the U.S. dollar a day before a European
Central Bank meeting.
    Bets that the ECB at its policy meeting on Thursday could
signal future interest-rate cuts pressured the euro. The Bank of
Japan will begin a two-day meeting on Thursday, but it is
expected to hold its fire this week.
    U.S. data showing a steady manufacturing sector and strong
gains in private employment supported equity markets. Stocks,
despite record highs, are still at attractive valuations,
analysts said.
    "When you reach a record high it triggers introspection
about whether we're over-valued, but I don't expect a pullback
because the reasons we've climbed are still in place," said
David Joy, chief market strategist at Ameriprise Financial in
Boston. "The market has the opportunity to move higher until
there's evidence those factors will die out."
    The S&P 500 index is trading at 13.6 times estimated
12-month earnings, compared with around 14.9 times in October
2007, when the index hit its record high, just 1.5 percent
higher than Wednesday's close.
    After the closing bell on Wall Street, the Dow Jones
industrial average was up 42.47 points, or 0.3 percent,
at 14,296.24, a record high. The S&P 500 gained 1.67
points, or 0.11 percent, to 1,541.46 and the Nasdaq Composite
 dropped 1.77 points, or 0.05 percent, to 3,222.36.
    The MSCI world index rose 0.15 percent.
    U.S. dollar-traded Nikkei futures added 2.2 percent. 
   Overnight in Asia, the Nikkei hit its highest in
4-1/2 years, helped by prospects of a reflationary policy in
Japan to revive growth.
   
    EURO, TREASURIES WEAKEN
    Better-than-expected U.S. private-sector jobs figures
reported by payrolls processor ADP on Wednesday dented the
allure of Treasuries. The figures come two days ahead of the
government's closely watched monthly payrolls report.
    The benchmark 10-year U.S. Treasury note was
down 13/32, the yield at a seven-day high of 1.9409 percent.
    "We had ADP employment data today which surprised to the
upside and that helped take (yields) higher," said Jake Lowery,
Treasury trader at ING Investment Management in Atlanta.
    "We have got supply coming next week, right around the
corner after payrolls, and it seems that with Treasuries trading
in a pretty tight range lately, more and more market
participants are focusing on small opportunities around the
supply calendar."
    The U.S. Treasury is set to auction three-year and 10-year
notes next week, along with 30-year bonds.
    In currency trading, the euro fell against the U.S. dollar
ahead of the ECB meeting.
    "The market has turned dovish on the ECB and that kept the
euro constrained," said Vassili Serebriakov, currency strategist
at BNP Paribas in New York. "While most are expecting the ECB to
keep rates steady, there are a few calls for a rate cut
tomorrow, including our bank."
    The euro was down 0.5 percent against the greenback
at $1.2988.
    The dollar also strengthened against the Japanese currency
, hitting a one-week high above 94 yen.
    The market is turning its attention to the BoJ's April 3-4
meeting, the first policy review under its new governor,
Haruhiko Kuroda, who is an advocate of aggressive monetary
easing.
    Copper slumped after a two-day rebound, weighed by
uncertainty about metals demand in China, the world's top
consumer, and economic growth in Europe.
    Three-month copper fell 0.85 percent to $7,690 a
ton, erasing initial gains that took it above $7,812.
    Areas of concern for the global economy remain, including
the Chinese government's move to cool the country's overheated
property market, the possible economic impact of U.S. spending
cuts and political deadlock in Italy.
    Brent oil pared losses to settle down 0.5 percent at
$111.06 a barrel, while U.S. crude briefly slipped below
$90 before settling down 0.4 percent at $90.43.
    U.S. crude oil inventories rose more than forecast last week
while distillates stocks fell more than expected as refinery
utilization rates posted a surprise drop, data from the Energy
Information Administration showed on Wednesday.
    Gold rose in late trading on expectations central banks
would maintain loose monetary policy, but still in the tight
price range of recent sessions.
    Spot gold was up 0.5 percent $1,582.50 an ounce.
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