Oil rallies, lifts stocks while euro stays steady

Wed Mar 9, 2016 5:03pm EST
 
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By Caroline Valetkevitch

NEW YORK (Reuters) - Oil prices resumed a more than month-long rally on Wednesday, helping to lift world stock markets, while the euro held steady ahead of this week's European Central Bank meeting.

Brent moved back above $40 a barrel on speculation the world's largest exporters would agree this month to freeze production and help reduce the largest global build in crude oil in years.

Brent LCOc1 rose $1.42 to settle at $41.07 a barrel, up more than 40 percent from its January lows, while U.S. crude CLc1 increased $1.79 to settle at $38.29.

Wall Street stocks built on recent gains on Wednesday as the strong recovery in oil prices sent energy shares sharply higher. The S&P energy index .SPNY rose 1.5 percent.

"Stability in that asset class (oil) for a period of time will allow for the correlation to break down," said Art Hogan, chief market strategist at Wunderlich Securities in New York.

The Dow Jones industrial average .DJI ended up 36.26 points, or 0.21 percent, to 17,000.36, the S&P 500 .SPX gained 10 points, or 0.51 percent, to 1,989.26 and the Nasdaq Composite .IXIC added 25.55 points, or 0.55 percent, to 4,674.38.

MSCI's all-country world stock index .MIWD00000PUS gained 0.3 percent, while in Europe, the pan-regional FTSEurofirst 300 index .FTEU3 closed 0.45 percent higher.

The biggest weekly draw in U.S. gasoline in almost two years persuaded traders that energy demand was improving despite crude stockpiles at record highs.   Continued...

 
Traders work on the floor of the New York Stock Exchange shortly after the opening bell in New York March 9, 2016. REUTERS/Lucas Jackson