* Economic data fuels European, U.S. stock rally
* World equity markets rebound from Monday's sharp sell-off
* Euro lifted by above-forecast euro zone services data
* Brent crude close to $117 a barrel
By Herbert Lash
NEW YORK, Feb 5 Global equity markets and oil
prices bounced back on Tuesday after January data on business
activity in the euro zone showed signs of recovery while the
U.S. service sector grew last month for a third year of
back-to-back monthly expansion.
Major U.S. and European stock indexes rallied, with Wall
Street gaining about 0.9 percent after a sell-off the previous
session. A measure of world equity markets also was higher,
though not nearly as much.
U.S. stocks advanced, fueled by strong fourth-quarter
earnings and signs of improving economic growth, which suggested
the longer-term trend for equities remains higher.
"Stocks are really the only place investors can go for any
kind of real return, and that's enough to have people continuing
to come into the market, not just buying on dips but in
general," said Thomas Nyheim, a portfolio manager at Christiana
Trust in Greenville, Delaware.
The Dow Jones industrial average was up 116.32
points, or 0.84 percent, at 13,996.40. The Standard & Poor's 500
Index was up 13.95 points, or 0.93 percent, at 1,509.66.
The Nasdaq Composite Index was up 31.25 points, or 1.00
percent, at 3,162.42.
MSCI's all-country world equity index rose
0.2 percent to 354.70, while a measure of European stocks
gained 0.5 percent.
U.S. Treasuries prices fell, spurred by Markit's Eurozone
Composite PMI, which rose to a 10-month high of 48.6 from 47.2
in December - better than the preliminary reading of 48.2. The
data is based on business activity across thousands of companies
and is considered a good gauge of growth.
The benchmark 10-year U.S. Treasury note was
down 15/32 in price to yield 2.0088 percent.
The Institute for Supply Management said its U.S. services
sector index eased slightly, to 55.2 last month from 55.7 in
December. The reading was in line with economists' forecasts,
according to a Reuters survey.
Brent crude oil rose $1.15 a barrel to $116.75,
while U.S. crude futures gained 53 cents to $96.70.
"We do not envisage prices receding for any great length of
time," said Carsten Fritsch, an analyst at Commerzbank. "The
supply-side risks still prevailing, shrinking OPEC supplies and
the brightening global economic outlook all suggest that such a
retreat is unlikely."
The euro rose against the dollar and yen, returning to its
months-long trend of appreciation, as better-than-expected euro
zone data affirmed expectations that the European Central Bank
will keep policy steady when it meets this week.
The euro, which had taken the brunt of the selling and
fallen from a high of over $1.37 at the end of last week
to under $1.35 on Monday, rose 0.13 percent to trade at $1.3530.