* Stocks rebound, reports say Cyprus hours away from deal
* Euro recovers on investor optimism about a Cyprus deal
* Oil holds above $107 as bailout deadline nears
* Bond prices fall
By Herbert Lash
NEW YORK, March 22 Global equity markets and the
euro rebounded on Friday on hopes Cyprus will avert a financial
collapse, taking succor from an agreement that shielded Greek
banks from the Cypriot crisis and remarks that the island nation
was hours away from a bailout.
U.S. and European shares rebounded earlier in the session on
reports Greek banks had agreed to buy the local units of
stricken Cypriot banks.
The deputy leader of the ruling party in Cyprus later said
that the country was close to a compromise that would let its
parliament reverse the rejection of a rescue package offered by
euro zone partners a week ago.
The euro rose 0.67 percent to $1.2984 even as Cyprus'
increasingly isolated leaders scrambled to strike a bailout deal
with the European Union by Monday, after Russia rebuffed Cypriot
entreaties for aid.
Cyprus took a first step toward financial consolidation by
arranging for a Greek competitor to take over big Greek units of
its banks. Piraeus Bank was chosen to take over the
Greek branches of Cypriot lenders that are being sold.
"It seems that investors are expecting a deal before the
Monday deadline. So they're not placing new shorts on the euro
going into the weekend. They don't want to be caught on the
wrong side of the bet in case a deal does materialize," said
Brian Kim, currency strategist at RBS Securities in Stamford,
Wall Street was lifted by retail stocks, the day's top
gainers, on better-than-expected results from Nike Inc.
Nike shares rose 11.6 percent to $59.81.
"While the market may be vulnerable because it's up so much,
the U.S. economy is in a better shape and better position to
withstand the whole euro zone and Cyprus situation," said Randy
Frederick, managing director of active trading and derivatives
at Charles Schwab.
The Dow Jones industrial average was up 80.41 points,
or 0.56 percent, at 14,501.90. The Standard & Poor's 500 Index
was up 9.49 points, or 0.61 percent, at 1,555.29. The
Nasdaq Composite Index was up 19.38 points, or 0.60
percent, at 3,241.98.
MSCI's all-country world equity index gained
0.2 at 358.52.
The pan-European FTSEurofirst 300 retreated to
close down 0.1 percent to 1189.44.
Oil prices rose above $107 a barrel. Brent crude for May
delivery was up 16 cents at $107.63 a barrel. U.S. crude
for May settled up $1.26 at $93.71 a barrel.
The benchmark 10-year U.S. Treasury note traded
flat in price to yield 1.9129 percent.