* China GDP grows 7.4 pct, slightly ahead of forecasts
* European shares rebound, Wall Street rallies, Yahoo shines
* Oil rises close to $110 on mounting Ukraine tension
(Adds oil settlement)
By Herbert Lash
NEW YORK, April 16 Global equity markets
advanced broadly on Wednesday after China reported growth that
beat expectations, providing relief to investors worried about
the Chinese economy, while the dollar slid on the growing view
the Federal Reserve will keep interest rates lower than normal
for a few years.
Fed Chair Janet Yellen told the Economic Club of New York
that the U.S. economy appeared to be slowly moving toward full
employment, but that it would need help from the central bank
for some time to come.
Yellen said that achieving the Fed's economic goals "will
likely require low real interest rates for some time," a policy
view she said was shared broadly across many advanced economies.
Wall Street rallied for a third straight day. The Nasdaq
Composite was up about 3.3 percent from its intraday low on
Tuesday, which was a whisker away from a 20 percent correction.
China's economy grew 7.4 percent in the first quarter from a
year earlier, topping forecasts of 7.3 percent. There had been
speculation that growth would be closer to 7 percent after a
string of recent soft numbers.
The relief rippled through Asian markets, then spread to
Europe and Wall Street. Japan's Nikkei ended up 3
percent, its biggest gain since February.
MSCI's all-country world index rose 0.85
percent, while the FTSEurofirst 300 index of leading
European shares closed up 1.2 percent at 1,322.51 points. Yet
many traders pegged the gain as a technical rebound after a 1
percent decline in the previous session.
Earlier this month, the European index hit a near six-year
high, a rally that has been halted by worries over the crisis in
Ukraine as well as worries about China, the world's second
"There is a lot of concern about Chinese growth this year,
so there is some relief in the GDP number," said Jim Russell,
senior investment strategist at U.S. Bank Wealth Management in
Cincinnati. "We think that is influencing the market today."
On Wall Street, the Dow Jones industrial average rose
129.15 points, or 0.79 percent, to 16,391.71. The S&P 500
gained 13.71 points, or 0.74 percent, to 1,856.69 and the Nasdaq
Composite added 33.399 points, or 0.83 percent, to
Yahoo was the leading percentage gainer on the S&P
500 as investors focused on the company's 24 percent stake in
Chinese internet company Alibaba Group Holding Inc IPO-ALIB.N,
which reported a surge in quarterly revenue growth in the last
quarter of 2013. Yahoo shares jumped 5.8 percent to $36.20.
Google and IBM will report quarterly
results later on Wednesday.
In U.S. economic news, industrial production rose at a
faster-than-expected clip in March, the latest sign the economy
was gaining momentum.
Groundbreaking for new homes also increased but remained
well below the post-recession peak hit in November, signaling
the drag the housing market is placing on the economy.
The euro rose 0.07 percent to $1.3822. There were
also more bond gains for former trouble spots Italy, Spain,
Portugal and Greece.
The 10-year U.S. Treasury note slipped 3/32 of a point in
price, boosting its yield to 2.6409 percent, as the growth in
China reduced demand for safe-haven government bonds.
But mounting risks in Ukraine after Russia declared the
country to be on the brink of civil war and Kiev said an
"anti-terrorist operation" against pro-Moscow separatists was
under way helped drive up oil prices.
Ukrainian government forces and pro-Russian rebels staged
rival shows of force in eastern Ukraine on Wednesday, though
hopes remained that talks in Switzerland on Thursday between
Ukraine, Russia, the U.S. and the European Union could cool the
Global oil prices rose close to $110 a barrel but gave up
some gains after an unexpectedly large build in crude stocks in
the United States, the world's largest consumer of oil.
Brent crude for June delivery rose by a dollar
earlier in the session but pared gains to settle up 24 cents at
$109.60 a barrel.
U.S. crude for May delivery also rose more than $1
before paring gains immediately after closely watched data form
the U.S. Energy Information Administration (EIA) was released.
U.S. crude settled 1 cent higher at $103.76 a barrel.
Crude oil stocks rose 10 million barrels to 394 million
barrels in the week ending April 11, according to EIA data, far
more than the 2.3 million-barrel build expected by analysts.
(Additional reporting by Marc Jones in London; Editing by
Meredith Mazzilli, Leslie Adler and Jonathan Oatis)