NEW YORK: Global stock markets rose on strong European and US shares on Thursday, with stocks brushing off a rapid re-acceleration in coronavirus cases and oil and the dollar extending their first-half rallies.
On Wall Street, the S&P 500 reached its sixth consecutive all-time closing high on upbeat economic data, and European shares ended higher on a rally in crude prices.
Investors now eye Friday's much-anticipated employment report.
"Markets are digesting improved economic data and rising inflation, closely scrutinizing central bank communication for clues regarding the timing, process and magnitude of policy normalisation," said Ben Randl, a senior analyst at Bank of America Merrill Lynch.
In an Asia session thinned by a holiday in Hong Kong, Japan's Nikkei fell 0.3 per cent and the yen hit a 15-month low as sources in Tokyo said Covid-19 restrictions were likely to be extended.
Oil prices rose about 2 per cent on indications that OPEC+ producers could increase output more slowly than expected in coming months, while rising global fuel demand would continue to tighten supply.
The dollar index hit three-month highs and US Treasury yields crept a little higher ahead of Friday's US jobs report, which could offer clues on when the Federal Reserve will start to pare back stimulus.
The benchmark 10-year yield was last up 3.1 basis points at 1.4747 per cent. On Wednesday, it tumbled to its lowest level since June 21 at 1.438 per cent, due mostly to quarter- and month-end demand.
Gold edged up on Thursday as a more than 7 per cent slide in June prompted some traders to buy the metal amid concerns over the Delta variant of the coronavirus.
The MSCI world equity index, which tracks shares in 50 countries, rose 0.26 per cent. The pan-European STOXX 600 index rose 0.62 per cent.
MSCI's broadest index of Asia-Pacific shares outside Japan closed 0.56 per cent lower, while Japan's Nikkei lost 0.29 per cent.
Traders think US payrolls on Friday could jolt markets from a slumber that has locked currencies in some of their tightest trading ranges for decades. Initial claims for state unemployment benefits dropped 51,000 to a seasonally adjusted 364,000 for the week ended June 26, the Labor Department said on Thursday, although they are an unreliable guide to Friday's broader indicators.
June had been the best month for the dollar since Donald Trump was elected US president in November 2016, MUFG's currency analyst Lee Hardman said.
"The key trigger," he said "has been the hawkish shift in the Fed’s policy stance. The more hawkish guidance has left market participants less confident that the Fed will maintain loose policy in the coming years."
The US dollar index, which measures the greenback against six major counterparts, rose to 92.602, the highest since early April. It last traded up 0.2 per cent at 92.572.
The Dow Jones Industrial Average rose 131.02 points, or 0.38 per cent, to 34,633.53, the S&P 500 gained 22.44 points, or 0.52 per cent, to 4,319.94 and the Nasdaq Composite added 18.42 points, or 0.13 per cent, to 14,522.38.
Brent crude settled up $1.22, or 1.63 per cent, at $75.84 a barrel. US crude settled up $1.76, or 2.4 per cent, at $75.18 per barrel.
Spot gold prices rose $3.3126, or 0.19 per cent, to $1,773.12 an ounce. - Reuters