GLOBAL MARKETS-Equities rally, dollar weakens on signals from Fed minutes

Wed Apr 9, 2014 4:50pm EDT

* Fed minutes suggest rates may not rise anytime soon
    * Bond prices fall after minutes suggest rate hike unlikely
    * Alcoa's results help boost sentiment, shares rise 3.8
percent
    * Brent oil rises toward $108 a barrel on Ukraine worries

 (Adds close of U.S. markets)
    By Herbert Lash
    NEW YORK, April 9 (Reuters) - Global equity markets advanced
and the dollar retreated on  Wednesday after minutes from the
Federal Reserve's latest policy meeting suggested the U.S.
central bank may not raise interest rates anytime soon.
    Stocks on Wall Street jumped more than than 1 percent and
prices of U.S. government debt fell following release of the
minutes from the Fed's March 18-19 meeting.  
    Fed policymakers were unanimous in wanting to ditch the
thresholds they had been using to telegraph a policy tightening,
according to the minutes, which shed little new light on what
might prompt a rise in interest rates. 
    They fretted that investors would overreact to published
forecasts that suggested a more aggressive cycle of interest
rate increases was coming than they planned.
    "People are taking solace in the idea that the Fed may be
more accommodative than previously thought, for longer than
previously thought," said Steve Sosnick, equity-risk manager at
Timber Hill/Interactive Brokers Group in Greenwich, Connecticut.
"That's giving the lift to stocks and explains why the dollar
fell against the euro."
    The Dow Jones industrial average closed up 181.04
points, or 1.11 percent, at 16,437.18. The S&P 500 gained
20.22 points, or 1.09 percent, to 1,872.18 and the Nasdaq
Composite added 70.914 points, or 1.72 percent, to
4,183.9.
    The euro rose as high as $1.3862, its strongest level
since March 19, and was last at $1.3854, up 0.43 percent.
    Against the Swiss franc, the dollar fell to 0.8789 franc
, its lowest level in more than two weeks. 
    The dollar traded higher against the yen, having fallen
following the Fed minutes after trading higher for most of the
session. It last traded up 0.18 percent at 101.97 yen.
    U.S. stocks rose early in the session after aluminum
producer Alcoa late Tuesday reported quarterly results
that topped analysts' expectations, even though the company's
adjusted profit fell due to declining aluminum prices.
 
    Shares of Alcoa gained 3.8 percent to $13.00 and at
one point were the best performer among components of the
benchmark S&P 500 index. 
    Alcoa had long been the first company in the Dow Industrials
to report results each quarter. Since aluminum is used in key
industries, including the automotive, aerospace and construction
sectors, some see it as a bellwether for the earnings season.
    The company is no longer a Dow component.
    Earnings for companies in the S&P 500 are projected to have
increased just 1 percent from last year's first quarter, Thomson
Reuters data showed. The forecast is down sharply from the start
of the year, when profit growth was estimated at 6.5 percent.
    "Earnings will really help give this market some forward
direction, but they are in front of us and haven't really hit
yet," said Rick Meckler, president of hedge fund LibertyView
Capital Management in Jersey City, New Jersey.
    The Nasdaq biotechnology index was up 4.1 percent and
the Global X social media index was up 3.3 percent.
    The pan-European FTSEurofirst 300 index of leading
regional shares closed up 0.36 percent at 1,338.12, while MSCI's
all-country equity index rose 0.66 percent.
    Gains in Europe were led by automakers, although some
traders said caution ahead of the European earnings season could
curb near-term progress.
    U.S. Treasuries prices fell as traders trimmed their bond
holdings in advance of a $21 billion auction of 10-year notes.
    The benchmark 10-year Treasury note was down
5/32 in price to yield 2.6989 percent.
    Brent crude rose toward $108 a barrel as rising tension
between Russia and Ukraine overshadowed the bearish impact of a
substantial rise in crude oil stockpiles in the United States.
    While the Ukraine crisis may not directly impact global oil
supplies and trade, the risk premium on oil is rising as
investors worry the Kremlin's stand-off with the West could
quickly take a turn for the worse.
    Brent crude rose 31 cents to settle at $107.98 a
barrel. U.S. oil settled up $1.04 to $103.60.
    

 (Reporting by Herbert Lash; Additional reporting by Marc Jones
in London; Editing by Dan Grebler and Leslie Adler)
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