US stocks rallied and oil prices jumped as much as 6 percent today after the Federal Reserve indicated it preferred a more gradual path to normalizing US interest rates even as it moved toward its first rate hike in almost a decade.
The Fed, in its statement following a two-day meeting of policy-makers, slashed interest rate projections over the next few years and lowered its outlook on the US economy.
The Dow Jones industrial average closed up 227.11 points, or 1.27 percent, at 18,076.19. The S&P 500 rose 25.14 points, or 1.21 percent, to 2,099.42 and the Nasdaq Composite added 45.39 points, or 0.92 percent, to 4,982.83.
European shares also rose, with Standard Chartered surging on broker upgrades and Lafarge leading the construction and materials sector higher on expectations that a merger deal with Holcim could be saved.
Lafarge rose 5.5 percent after sources said the cement maker was seeking to save its merger with Switzerland’s Holcim and the two were discussing on a new CEO for the combined group that would see Lafarge boss Bruno Lafont in a different role. Holcim rose 2.7 percent.
The STOXX Europe 600 Construction and Materials index rose 1.1 percent, while the pan-European FTSEurofirst 300 index ended 0.4 percent higher at 1,590.25 points.
Standard Chartered, up 8.1 percent, led the FTSEurofirst 300 higher, after Bernstein double upgraded its stance on the stock to «outperform» and Barclays upgraded to «overweight» from «equalweight».
However, gains were capped by weaker autos, with Germany’s BMW falling 4.2 percent after saying it expected 2015 sales volumes and profit before tax to rise by mid to high single-digit percentages, more subdued than its guidance a year ago. Germany’s DAX fell 0.5 percent, underperforming the market.
The European automobile sector index fell 2.6 percent, with analysts saying that investors were also taking profits after the sector’s 30 percent rally this year.
Greek banks fell 8.3 percent, dragged down by a 10 percent fall in National Bank of Greece and an 8.6 percent slide in Alpha Bank on concerns about the country’s debt situation.
Meanwhile, Japan’s Nikkei share average rose to a fresh 15-year high today on hopes for an economic recovery and higher shareholder returns, while Nintendo Co jumped 21 percent after it said it will enter the smartphone gaming industry.
The Nikkei ended 0.6 percent higher at 19,544.48, the highest closing since April 2000.
Nintendo soared to its daily limit of 17,080 yen after remaining untraded during trading hours as its buy orders outnumbered sell orders.
Tokyo Stock Exchange rules mean that a glut of bid orders, unmatched by sufficient sell orders, can leave shares untraded during the day. Analysts said that investors have continued to buy Tokyo shares on hopes for steady improvement in Japan’s economy and increased shareholder returns.
Toyota Motor Corp rose 1.5 percent to 8,463 yen after touching a fresh record high of 8,480 yen, while Mitsubishi UFJ Financial Group gained 1.7 percent and SMFG advanced 0.7 percent.
Markets awaited the US Federal Reserve’s policy statement later in the day for more clues on when it will raise interest rates.
The broader Topix gained 0.8 percent to 1,582.46 and the JPX-Nikkei Index 400 added 0.6 percent to 14,385.44.
Source: Buenos Aires Herald