World equities markets and the euro rose yesterday amid merger activity and signals that central banks are willing to step further into the economic breach to support growth and inflation.
The dollar weakened and oil prices held steady, with Brent staying above $80 a barrel.
Share prices found support after a Reuters report that the People’s Bank of China was ready to further ease monetary policy to head off slowing inflation. This followed Friday’s interest rate cut by the country’s central bank.
European Central Bank President Mario Draghi also looked to be clearing the way for full-scale government bond buying that investors hoped for, but he was opposed byGermany’s Bundesbank.
The MSCI world equity index, which tracks shares in 45 nations, rose 0.16 per cent to 425.99.
Wall Street, which has had five straight winning weeks, touched record highs yesterday.
Shares tied to the pace of American economic growth led gains.
“The carry-over effect from China, taken with the fact that the US is pretty healthy, and you have a market with a bias to trend higher,” said Mike Gibbs, co-head of the equity advisory group at Raymond James in Memphis.
The Dow Jones industrial average was flat, while the broader S&P 500 was up 4.66 points, or 0.23 per cent, to 2,068.16 and the Nasdaq Composite added 0.68 per cent to 4,745.18.
The euro added to gains against the dollar after data showed growth in the US services sector fell short of forecasts. Earlier a report indicated German business sentiment rebounded in November after six straight declines.
The euro was last up 0.30 per cent at $1.2426, and the dollar index was off 0.15 per cent after touching a near four-and-a-half-year high.
Deals in the packaging sector in Switzerland, automotive parts in Korea, insurance in the United States, mobile phones in Nigeria and biopharmaceuticals in the Netherlands were adding to the risk-taking sentiment.
German and French stock indexes rose about 0.5 per cent each.
Oil prices meandered in a tight range but Brent stayed over $80 a barrel ahead of a key Opec meeting on Thursday amid uncertainty over whether there would be an agreement on a meaningful cut in output to support prices.
Brent crude was last down five cents at $80.31 a barrel. US crude was last up 15 cents at $76.66 per barrel. Prices have tumbled 30 per cent since June to their lowest in over four years.
US Treasury prices dipped ahead of new debt supply this week and profit-taking ahead of the US Thanksgiving holiday.