Global stocks down for fourth month running; oil up

NEW YORK (Reuters) - A gauge of stocks across the globe on Monday posted its fourth straight month of declines, while crude oil notched its first positive month since October.

Traders work on the floor of the New York Stock Exchange (NYSE) February 29, 2016. REUTERS/Brendan McDermid

Gold closed February with a gain of more than 10 percent, the most for any month in four years.

Stocks rose through most of the U.S. session after China’s central bank resumed its easing cycle by injecting an estimated $100 billion worth of long-term cash into the economy.

But Wall Street sold off into the close and the global stocks gauge finished in the red.

Equity markets so far this year have been strongly correlated with crude oil futures, which earlier this month tanked to decade lows. On Monday, however, U.S. stocks reversed the correlation and fell as investors took profits on last equity week’s gains.

“The market’s had a big run, so I don’t think it’s anything drastic, just lightening up after a big pop,” said J.J. Feldman, portfolio manager at Miracle Mile Advisors in Los Angeles.

On Monday, the Dow Jones industrial average .DJI fell 123.47 points, or 0.74 percent, to 16,516.5, the S&P 500 .SPX lost 15.82 points, or 0.81 percent, to 1,932.23 and the Nasdaq Composite .IXIC dropped 32.52 points, or 0.71 percent, to 4,557.95.

For the month, the Dow rose 0.3 percent, the S&P 500 lost 0.4 percent and the Nasdaq lost 1.2 percent.

MSCI's global stocks index .MIWD00000PUS fell 0.9 percent for the month, bringing its decline since November to 9.6 percent.

Oil prices jumped after China moved to boost its slowing economy. A drop in crude output from OPEC and the United States, and a pledge by Saudi Arabia to limit market volatility, suggested a 20-month selloff could be hitting a bottom.

“We have to accept the fact that crude is going to work its way higher from here,” said Jeffrey Grossman, energy dealer at New York’s BRG Brokerage.

Brent futures LCOc1 settled up 2.5 percent at $35.97 a barrel. U.S. crude futures CLc1 settled up 3 percent at $33.75. Both rose in February for the first month in four.

Long-dated U.S. Treasury prices rose after weak U.S. housing data supported the view that the Federal Reserve could slow the pace of interest rate hikes this year. Recent U.S. economic reports, including a pick-up in inflation, had shifted the view the Fed could raise interest rates before year-end.

The benchmark 10-year note US10YT=RR was last up 8/32 in price to yield 1.738 percent, down from 1.764 percent late on Friday. U.S. Treasuries prices showed a second month of gains.

The dollar .DXY rose 0.1 percent against a basket of six major currencies, backed largely by a move down from the euro EUR=.

The euro hit $1.0859, its lowest against the dollar since the start of the month, after consumer prices in Europe fell again. A drop in the flash reading of euro zone inflation to -0.2 percent boosted expectations that the European Central Bank will have to ease policy aggressively next month.

But the dollar tumbled against the Japanese yen JPY=, losing around 1 percent, as investors sought its safety. The yen appreciated nearly 7 percent versus the greenback in February, its best monthly performance against the dollar in more than seven years.

Gold, another investor “safe haven,” rose 1.3 percent on Monday to close its best month since January 2012.

Reporting by Dion Rabouin; additional reporting by Nigel Stephenson and Patrick Graham in London, Hideyuki Sano in Tokyo, Henning Gloystein in Singapore, Sujata Rao, John Geddie; Editing by Toby Chopra and Nick Zieminski