Signals of stimulus from Federal Reserves pushes stocks, oil up

Signals of stimulus from Federal Reserves pushes stocks, oil up

Signals of stimulus from Federal Reserves pushes stocks, oil up

Traders work on the floor of the New York Stock Exchange. REUTERS photo

European shares rose yesterday as fresh signs that the U.S. Federal Reserve may launch new stimulus measures more than offset persistent worries over the euro zone debt crisis. Oil prices also joined the march

The FTSEurofirst 300 index rose 0.6 percent to 1,102.12 points, bouncing back from a 1.2 percent fall on Aug. 22. The Euro STOXX 50 index was up by 0.9 percent at 2,474.84 points.

The minutes from the latest Fed meeting, released on Aug. 22 after European markets had closed, showed the U.S. central bank was likely to deliver another round of monetary stimulus ‘fairly
soon’ unless the economy improved considerably.

“The market seems more interested in more prospects of stimulus from the Fed than worries over the euro crisis. In the short-term, the market could get back up to the highs which we’ve seen in
the last few weeks,” Reuters quoted Darren Easton, director of trading at London-based Logic Investments, as saying. Oil prices also rose yesterday above $98 after Fed indicates more help may be on its way to help U.S. economy.

US and UK oil prices increase

Benchmark crude for October delivery rose 88 cents in late afternoon Bangkok time to $98.15 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 42 cents to finish at $97.26 per barrel in New York on Aug. 22.

Brent crude rose $1.27 to $116.18 on the ICE Futures exchange in London. Oil prices have risen about $8 per barrel since Aug. 1, partly on hopes that the U.S., Europe and China would do more to increase growth in their respective economies. Slower growth cuts into the demand for oil and other energy products, The Associated Press reported.

In other futures trading on the Nymex, heating oil rose 3 cents to $3.1654 per gallon. Gasoline futures rose 4 cents to $2.9739. Natural gas rose 1 cent to $2.841 per gallon.

Asian shares were also slightly up yesterday.

Tokyo closed up 0.51 percent, adding 46.38 points, to 9,178.12, as the yen remained firm against the dollar, while Seoul finished 0.38 percent higher, or 7.35 points up, at 1,942.54.

Sydney rose 0.17 percent, or 7.7 points, to close at 4,383.7, Hong Kong finished 1.23 percent, or 244.46 points, higher and Shanghai closed up 0.25 percent, adding 5.36 points, to 2,113.07 Dealers said

Chinese shares were affected positively by HSBC’s announcement that China’s manufacturing activity weakened to a nine-month low in August.

Gold was at $1,663.38 early in the morning trade , compared to $1,642.15 a day earlier.