April 24, 2013 / 3:01 PM / in 4 years

GLOBAL MARKETS-Shares, oil rise after weak data backs ECB rate cut

* ECB lending, German Ifo data bolster rate cut expectations

* European shares build on biggest jump in seven months

* Euro hits three-week lows vs dollar before rebound

* Durable goods data weighs on U.S. stocks

By Herbert Lash

NEW YORK, April 24 (Reuters) - Global equity markets and crude oil edged higher on Wednesday, drawing support from strong corporate earnings and speculation of a European Central Bank interest rate cut after weak German economic data.

Wall Street traded flat to lower after a report said U.S. durable goods recorded their biggest drop in seven months in March, which tempered enthusiasm over a relatively robust earnings season.

A gauge of planned business spending rose only modestly, indicating a slowdown in U.S. economic activity, which also weighed on U.S. equities.

News that German business sentiment in April was worse than the most pessimistic forecasts and fell for the second consecutive month weighed on the euro but boosted European equities.

The report from the Munich-based Ifo think tank added to the view that the ECB is closer to lowering interest rates than at any time since it last cut them in July 2012 and is likely to cut rates a quarter-point at its policy meeting next week.

“There is enthusiasm the ECB is poised to cut rates and that simply means more liquidity and that is the underlying, basic strong factor for stock markets around the globe,” said Peter Cardillo, chief market economist at Rockwell Global Capital in New York.

Cardillo said earnings continue to surprise to the upside for the most part, so enthusiasm for equities continues to grow.

Analysts see earnings growth of 2.3 percent this quarter, up from expectations of 1.5 percent at the start of the month.

More than 68.9 percent of S&P 500 companies that have reported results so far have beat expectations, according to Thomson Reuters data through Tuesday morning. Since 1994, 63 percent have surpassed estimates on average, while the beat rate is 67 percent over the past four quarters.

MSCI’s all-country world equity index rose 0.53 percent to 362.98.

On Wall Street, the Dow Jones industrial average was down 7.01 points, or 0.05 percent, at 14,712.45. The Standard & Poor’s 500 Index was up 1.85 points, or 0.12 percent, at 1,580.63. The Nasdaq Composite Index was down 3.82 points, or 0.12 percent, at 3,265.52.

In Europe, the FTSEurofirst 300 of top regional shares was up 0.7 percent at 1,191.33.

Brent crude rose toward $101 a barrel, taking a cue from strong equity markets, but gains were capped by the U.S. and German data, which indicated slower growth and fuel demand in major economies.

Brent futures were up 67 cents at $100.98 a barrel. U.S. crude futures gained 96 cents to $90.14.

“It’s an unusual situation in that bad economic news is good news for markets because it implies more easing by the central banks,” said Olivier Jakob, analyst at Petromatrix in Zug, Switzerland.

The euro initially edged lower against the dollar but held above a near three-week low as hopes that Italy can resolve its political gridlock were trumped by the weak German data, which fanned talk of an ECB rate cut.

The euro dropped to $1.2954, its lowest since April 5, before paring losses to trade slightly higher at $1.3002.

The benchmark 10-year U.S. Treasury note was up 1/32, the yield at 1.7013 percent.

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