Investors pushed stocks higher and bond prices lower today after a morning of jitters over the Iraq war had stalled most markets.
Oil prices rose steadily as supply worries mounted. The dollar was steady against major currencies and gold rose $1 an ounce. Traders were also keeping a close eye on the war but also focusing on supply disruptions from Nigeria, where ethnic clashes have removed 817,000 barrels per day from the global oil market.
US May light crude futures rose 80 cents to $28.77 a barrel, after a 25 per cent fall last week. London Brent gained 80 cents to $25.61.
European stocks rose more than one per cent after fluctuating around yesterday's close. US stock futures also moved higher. suggesting Wall Street would open up.
The FTSE Eurotop 300 index was up one per cent and the narrower DJ Euro Stoxx 50 index was up 1.42 per cent.
The European stock market is now up about 15 per cent from its March 12th six-year closing low. Earlier on Wednesday in Japan, the Nikkei average ended up 1.37 per cent while the broader TOPIX index closed 1.13 per cent higher.
Safe haven gold rose. Spot gold stood at $329.50 an ounce, compared with $328.25 at the New York close yesterday.
Euro zone government bond prices dipped slightly after fluctuating around Tuesday's levels. The two-year German Schatz note's yield, which moves in the opposite direction to the price, was up 1.6 basis points at 2.59 per cent. It hit a two-month high of 2.69 per cent last week. The 10-year Bund yield was up 2.2 basis points at 4.23 per cent.
"People in the bond market realise that this war will cost a lot of money and the economy is not doing too well, and governments are facing rising budget deficits," said one trader.
On the foreign exchange markets, the dollar held firm in tight ranges against major currencies, awaiting direction from developments in Iraq.
The dollar was barely changed on the day against the euro at $1.0644 after falling to its lowest levels since the start of the Iraq war yesterday.