Global Stocks Rise Led by Resources Companies

Global stocks rose Thursday, led by resources companies following a surge in commodities prices in the previous session and a late recovery on Wall Street.

The Stoxx Europe 600 was up 0.6% in early trade, as crude oil futures and industrial metals extended their rally from Wednesday. Shares in Anglo American PLC gained 10%.

A sharp fall in the U.S. dollar on Wednesday boosted oil and other dollar-denominated commodities, which become cheaper for foreign buyers as the dollar weakens. Brent crude oil was up 0.9% at $35.38 a barrel, while three month-copper futures on the London Metal Exchange hit a three-month high of $4,681 per ton.

The dollar retraced modestly early Thursday and was last up 0.2% against the yen at ¥ 1180830, while the euro was down 0.3% against the dollar at $1.1085.

In Asian trade, most markets rose in tandem with commodity prices. Australia's S&P ASX 200 gained 2.2%, while the Shanghai Composite Index added 1.5%.

Japan's Nikkei Stock Average fell 0.9%, however, as the yen climbed back against the dollar. The market has now lost almost all of its gains since the Bank of Japan's surprise interest rate cut on Friday.

Thursday's moves followed a choppy session on Wall Street, as the Dow Jones Industrial Average fell 193 points before closing higher on a rebound in energy shares.

Despite recent gains, analysts say the rally in oil prices is likely to be short-lived unless a solution to the supply glut can be reached.

Stock markets look set to remain volatile until energy prices find longer-term stability and investors achieve clarity on plans by the world's central banks.

"The Fed is proceeding down a path toward rate normalization at a time when economic growth both at home and abroad is fragile," said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management, which manages roughly $128 billion in assets.

The Federal Reserve will closely watch Friday's jobs report as it contemplates the course for U.S. interest rates this year.

On Wednesday, Federal Reserve Bank of New York President William Dudley said that financial conditions were reshaping the outlook in a way that could cause the Fed to delay additional rate raises. Concerns around the Chinese economy and its currency, volatility in oil prices, lackluster earnings and slowing global growth have weighed heavily on financial markets from the start of the year.

Meanwhile, the Bank of England will announce an interest rate decision later Thursday, but economists don't expect any change from the current record lows.

In European corporate news, Credit Suisse Group reported a large fourth-quarter loss. Shares fell 9.7%.

In the U.S., fourth-quarter earnings have so far mostly weakened in line with expectations, but some companies have flagged concerns about the outlook.

Gregor Stuart Hunter contributed to this article.

Write to Riva Gold at [e-mail]

(END) Dow Jones Newswires

February 04, 2016 04:35 ET (09:35 GMT)

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