* Yen slides broadly as Russia sanctions seen as modest
* Crimea referendum eases safety bid for U.S. Treasuries
* U.S. stocks also boosted by factory data
By Angela Moon
NEW YORK, March 17 World stocks rose sharply on
Monday and prices of the safe-haven yen and U.S. Treasuries
fell, a day after Crimea's vote to join Russia passed without
major violence, easing fears that had driven equities to a
one-month low on Friday.
The yen fell broadly after the United States and the
European Union imposed what investors perceived to be only
modest economic sanctions on some officials of Russia and
Ukraine following the Crimea vote.
The dollar, often a shelter for investors against global
stresses, was also down, with the dollar index, a measure
of the greenback's value against six major currencies, off 0.13
percent to 79.345 in afternoon trading.
Although investors are not ruling out another flare-up in
tensions between Russia and Ukraine, many do not expect
contagion to major markets. The lack of military conflict
between the two countries also appeased investors.
"The market thinks it's not so bad," said Joseph Trevisani,
chief market strategist at WorldWideMarkets Online Trading in
Woodcliff Lake, New Jersey. "You don't see any signs of play
against the euro. If the sanctions were serious, say against
Russia's oil and gas exports, you'd see selling of the euro
because they don't have much alternative for energy."
U.S. stocks closed roughly 1 percent higher, with the S&P
500 bouncing from its worst weekly drop in the past seven, as
the concerns over Crimea eased and as economic data indicated
the U.S. economy was improving after a winter slowdown.
The advance continued a recent trend of investors using
market pullbacks as buying opportunities. Major indexes have not
undergone a sustained pullback in more than a year.
The Dow Jones industrial average rose 181.55 points,
or 1.13 percent, to 16,247.22. The S&P 500 gained 17.7
points, or 0.96 percent, to 1,858.83, and the Nasdaq Composite
added 34.552 points, or 0.81 percent, to 4,279.949.
"It's sort of a relief rally there was no real negative
surprise (in Ukraine). What happened was what was expected,"
said Terry Morris, senior vice president and senior equity
manager for National Penn Investors Trust Company in Reading,
The MSCI world equity index, which tracks
shares in 45 countries, rose 0.8 percent, after hitting a
one-month low on Friday.
In late New York trading, the dollar was up 0.3 percent
against the yen at 101.66 yen, rising after four days of
losses driven by investors buying the safe-haven Japanese
currency in the midst of the Russia-Ukraine crisis.
The euro also gained against the yen, rising 0.5 percent to
141.51 yen. It climbed against the dollar, to $1.392
, despite data showing a dip in euro zone inflation, the
latest indicator to argue for outright money-printing by the
European Central Bank to support growth.
European stocks rose, bouncing back from a three-week slide.
The FTSEurofirst 300 index of top European shares ended
1 percent higher at 1,297.45 points, rising for only the second
time in seven sessions.
Shares of mining and industrial companies featured among the
biggest gainers, with BHP Billiton up 1.2 percent and
ArcelorMittal up 1.2 percent.
FED IN FOCUS
In the latest economic data, the New York Federal Reserve
Bank's Empire State index, a gauge of manufacturing in New York
state, rose in March, helped by increases in new orders and
inventories, though the rise was less than forecast. Separately,
U.S. industrial output rose 0.6 percent in February, a far
bigger rise than had been expected.
"The data gives us another kick up, since it is another sign
that we're recovering from recent weather issues," said Selkin,
who helps oversee about $3 billion in assets.
With the Crimea vote out of the way, investors are now
focusing on the Fed's two-day policy meeting that begins on
Tuesday. The central bank is expected to continue to reduce the
size of its bond purchase program but alter its forward
"They are going to move away from thresholds on specific
economic indicators and take a more holistic approach that
depends on subjective evaluation of a broad array of economic
indicators. They are trying to move back to a more normal
approach to policy," said Ward McCarthy, chief financial
economist at Jefferies in New York.
The Fed previously said that it would not raise interest
rates until joblessness fell to at least 6.5 percent;
unemployment hit a five-year low of 6.6 percent in January,
before rising to 6.7 percent in February.
Benchmark 10-year Treasury notes fell 13/32 in
price on Monday to yield 2.69 percent, up from 2.65 percent late
on Friday and in the middle of a two-month long range that has
kept yields between 2.57 percent and 2.82 percent.
U.S. crude oil rose on Monday, gaining for a third session
in a row. U.S. crude oil futures settled down 81 cents at
$98.08 a barrel.