* Japanese shares rally after BoJ move, yen weakens
* Crude oil rallies on Libyan supply disruptions
* Jump in Tesla shares propels tech-heavy Nasdaq
* Dollar falls against euro on weak U.S. data
By Ryan Vlastelica
NEW YORK, Feb 18 Stock markets around the world
edged higher on Tuesday following a fresh round of stimulus from
the Bank of Japan, though gains were limited by some tepid data
following a recent rally, which also pushed the dollar down
against the euro.
The Bank of Japan maintained its expansionary monetary
policy, extending special loan programs to help buoy economic
growth. Japanese shares jumped 3.1 percent, but other
markets in Asia were flat after China's central
bank acted to rein in lending and Australia's central bank made
hawkish comments about interest rates.
"The move by the Bank of Japan is important as it shows how
central banks around the world want to make sure economies don't
slip back into recession," said Wayne Kaufman, chief market
analyst at Rockwell Securities in New York. "That will be an
overriding factor in any trading."
The MSCI World index was up 0.3 percent. On
Wall Street, U.S. stocks broadly rose as merger activity boosted
Economic data pointed to continued struggles around the
globe, with German investor sentiment weaker and factory
activity in New York state slowing in February.
Also in the United States, the National Association of Home
Builders reported its index on homebuilder confidence fell in
February to 46, indicating that a majority of builders see
market conditions as poor. The data followed similarly weak
reads last week on retail sales and the labor market.
Investors have been looking to economic data to justify the
recent advance in equities, which has taken the S&P 500 back
near record levels even as the U.S. Federal Reserve has twice
trimmed its stimulus program. The Fed's publication on Wednesday
of the minutes of its latest meeting will be scoured by market
participants for confirmation that the slowing will continue at
a steady pace.
"We're getting overbought in the short-term, so it wouldn't
be surprising to see a pause in stocks, especially since some of
the data has been lukewarm," Kaufman said.
The Dow Jones industrial average was down 24.21
points, or 0.15 percent, at 16,130.18. The Standard & Poor's 500
Index was up 2.09 points, or 0.11 percent, at 1,840.72.
The Nasdaq Composite Index was up 28.76 points, or 0.68
percent, at 4,272.78.
The Nasdaq rose for an eighth straight day, its longest
streak since July. The tech-heavy index was boosted by a jump in
the shares of Tesla Motors Inc, which rose following a
report that Apple Inc's mergers and acquisitions chief,
Adrian Perica, met Tesla's chief executive, Elon Musk, last
year, sparking speculation that Apple could be interested in
buying the electric car maker.
Tesla rose 2.8 percent to $203.70 after hitting an all-time
high of $205.72. Apple rose 0.4 percent to $545.99.
Forest Laboratories was the best performer on the
S&P 500 after Actavis said it would acquire the
specialty pharmaceuticals company in a cash and stock deal
valued at about $25 billion. Forest Lab shares jumped 27.5
percent to $91.04 while Actavis shares rose 5.0 percent to
The benchmark 10-year U.S. Treasury note was up
9/32, with the yield at 2.7123 percent.
In Europe, the pan-European FTSEurofirst 300 index
closed with very slight gains. German Bund futures rose
0.2 percent, while Greek bond yields hovered around
their lowest level since the country's debt restructuring as
international lenders said they would return to Athens this week
to assess the delivery of economic reforms.
YEN LOSES GROUND
The big loser from the BoJ action and subsequent bank-led
Nikkei rally was the yen, which lost ground against all
its major currency peers, with the dollar gaining 0.4 percent.
The Japanese action helped "reverse the recent dollar/yen
bear trend," said Tom Levinson, currency strategist at ING,
adding that he thought 102.85/95 yen resistance would hold for
The dollar fell against the euro to its lowest in seven
weeks after the weak manufacturing data for New York state
stoked uncertainty about the direction of the Federal Reserve's
The euro rose to $1.3769, surpassing a key resistance
The U.S. dollar index, which measures the greenback
against a basket of six currencies, fell 0.2 percent, while the
euro rose 0.8 percent against the yen to post a new
After initially weathering a bout of profit-taking, gold
slid from a near 3-1/2-month peak, shedding 0.5 percent.
U.S. crude futures jumped 2.4 percent, boosted by
robust demand for heating fuel, as well as a weaker dollar and
supply disruptions in Libya. Brent crude rose 1.2
percent, topping $110 a barrel.