GLOBAL MARKETS-U.S. pick-up pushes shares to 1-month high, dollar firm

Tue Jul 9, 2013 10:40am EDT

* Shares rise after Alcoa's solid start to U.S. earnings
season
    * Greek aid deal initially lifts euro, euro zone debt
    * Oil eases as supply boosts outweigh Egypt worries


    By Herbert Lash
    NEW YORK, July 9 (Reuters) - Global equity markets extended
gains on Tuesday and the dollar traded near a three-year high,
spurred by an optimistic tone at a good start to the U.S.
earnings season after last week's strong jobs data.
    Equity markets reacted favorably after aluminum producer
Alcoa, traditionally the first major U.S. company to
report quarterly earnings, posted adjusted profit and revenue
above expectations after markets closed on Monday.
 
    Alcoa said it sees solid growth in global demand this year.
    "We've got a risk-on theme with Alcoa's better-than-expected
profits," said Jordan Hiscott, a trader at Gekko Global Markets.
"You are seeing people reallocating assets into equities, they
are definitely very popular at the moment." 
    Europe's broad FTSEurofirst 300 index of leading
regional companies hit its highest in a month before paring some
gains as a deal to provide Greece the latest 6.8 billion euro
($8.7 billion) installment of its bailout bolstered the upbeat
mood. 
    MSCI's all-country world equity index rose
0.72 percent. 
    According to Thomson Reuters data through Tuesday morning,
analysts' expectations call for S&P 500 earnings to increase 2.9
percent in the second quarter from a year ago, while revenue is
forecast to have increased 1.5 percent from a year ago. 
    The Dow Jones industrial average rose 74.3 points or
0.49 percent to 15,298.99, the S&P 500 gained 8.88 points
or 0.54 percent to 1,649.34, and the Nasdaq Composite 
added 10.14 points or 0.29 percent to 3,494.97.
    The Greek aid deal helped Greek and Portuguese bonds
 add to their gains of the last few days. It also
helped lift the euro  off the seven-week low it has been
at since the European Central Bank made clear last week it is
prepared to cut interest rates again.
    The dollar rose toward recent three-year highs against a
basket of currencies, with more investors betting on further
gains as the Federal Reserve prepares to reduce its stimulus
program.
    The dollar's biggest gains were against the British pound,
after weaker-than-expected UK data drove sterling close to a
three-year low and highlighted the divergence between UK and
U.S. monetary policy. 
    The dollar index, which measures the greenback
against a currency basket, was up 0.17 percent at 84.336, having
earlier hit 84.085 on a dip in U.S. Treasury yields.
    The euro was down 0.15 percent at $1.2850, holding
above Friday's seven-week trough of $1.2806. The single currency
found some support after Greece secured aid that will prevent it
from defaulting in August. 
    U.S. Treasuries prices held steady as investors prepared to
make room for a $32 billion three-year note sale, the first part
of this week's $66 billion in coupon-bearing supply.
    The 10-year U.S. Treasury note was 3/32 higher
in price to yield 2.630 percent. 
    Brent crude oil fell toward $107 a barrel as worries about
supply disruptions in the Middle East eased, though investors
were wary that more negative headlines from Egypt could trigger
renewed volatility. 
    Brent fell 13 cents to $107.30 after slipping to a
session low of $106.85 earlier. U.S. crude fell 20 cents
to $102.94.