* World stocks edge higher, bonds slip
* U.S. dollar slips to 2-week low against euro
* Gold jumps 4.0 percent
By Nick Olivari
NEW YORK, Dec 10 (Reuters) - Optimism that governments
worldwide will bail out ailing industries and implement
stimulus measures to fight the deepening economic crisis
supported stocks globally on Wednesday, raised oil prices and
capped recent gains in the yen.
In the latest in the automakers attempt to secure aid, the
White House said the government and congressional leaders had
reached a "good conceptual agreement" on a plan to help the
carmakers but had not yet agreed to a final bill. For details,
see []
"People are looking at the bailout as a positive," said
Peter Kenny, managing director at Knight Equity Markets in
Jersey City, New Jersey. "But the headwinds are just enormous,
this market has an awful lot to get through," he said.
The Dow Jones industrial average <> ended up 69.61
points, or 0.80 percent, at 8,760.04. The Standard & Poor's 500
Index <.SPX> rose 10.30 points, or 1.16 percent, at 898.97. The
Nasdaq Composite Index <> gained 18.14 points, or 1.17
percent, to 1,565.48.
Stocks of energy and materials companies also edged up
after trade sources said Saudi Arabia, OPEC's largest oil
exporter, informed major customers of a significant cut in
supplies for January before next week's OPEC meeting.
[]
Chevron <CVX.N> and Exxon Mobil <XOM.N> provided the Dow's
biggest lifts, rising 2.4 percent to $77.35 and 1.4 percent to
$79.31, respectively. Crude oil <CLc1> jumped more than 1
percent to $42.57 a barrel.
Still it was not all good news with earnings and profit
outlooks continuing to cast a pall. Shares of Eastman Kodak
slid more than 9.0 percent to $6.53 after the photography
company warned 2008 revenue and profit will fall short of
expectations. [].
European shares <> were little changed at the close,
held back by drugmakers as miners rose, but Japan's Nikkei
average <> rose 3.2 percent to a one-month closing high.
The MSCI main world stock index <.MIWD00000PUS> ended up
1.63 percent around 222.84.
If sustained, it would be the first time in seven months
that the world benchmark has had a monthly gain. The index has
lost around 45 percent this year.
"What we are seeing right now may be a gradual turnaround in
global stocks as liquidity in financial markets is seen slowly
improving, helped by the latest moves by governments," said Jun
Ji-won, a market analyst at Kiwoom.Com Securities in Seoul.
BONDS AND DOLLAR SLIP, GOLD UP
U.S. Treasury debt prices slipped on Wednesday, a day after
a safe-haven stampede sent ultra-safe three-month bill rates
below zero for the first time since the early 1940s.
Below-average demand at a $28 billion auction of three-year
notes on Wednesday also put downward pressure on bonds,
analysts said. For details see []
The higher-than-expected yield in the auction underscored
the day's uneven demand for U.S. government debt and fanned
worries over the possibility of a weak auction of $16 billion
in 10-year notes on Thursday, traders said.
Benchmark 10-year U.S. Treasury notes <US10YT=RR> were down
14/32 for a yield of 2.71 percent, up from 2.65 percent late on
Tuesday.
In Europe, the 30-year Bund yield <EU30YT=RR> was up eight
basis points at 3.69 percent.
The U.S. dollar fell to a two-week low against the euro on
Wednesday and the yen weakened as U.S. lawmakers reached
tentative agreement to extend emergency loans to the ailing
auto industry, helping to calm investor anxiety.
The low-yielding yen also fell as the pendulum swung back
in favor of currencies and assets that offer a higher return.
"It's safe to say risk appetite has improved somewhat, and
that has a lot to do with talk of an imminent bailout for the
U.S. auto industry," said Omer Esiner, chief market analyst at
Ruesch International in Washington.
Late afternoon, the euro was up 0.8 percent at $1.3022
<EUR=> after earlier hitting a two-week high of $1.3070. It
rose 1.4 percent to 120.70 yen <EURJPY=> while the dollar added
0.6 percent to 92.64 yen <JPY=>.
Analysts said fears of Bank of Japan intervention to
prevent too much yen strength also weighed on the currency
after BoJ Governor Masaaki Shirakawa said on Wednesday he was
watching forex moves carefully. []
Gold prices jumped over 4 percent higher on Wednesday,
rising above $800 an ounce as the U.S. dollar slipped. Spot
gold <XAU=> closed around $807.70 an ounce.
(Additional reporting by Leah Schnurr, Richard Leong, Gene
Ramos, and Frank Tang in New York, and Joanne Frearson and
George Matlock in London)
