(Recasts with U.S. markets, adds byline; changes dateline;
previous LONDON)
By Herbert Lash
NEW YORK, April 16 (Reuters) - Global stocks rose sharply
on Wednesday after reassuring results at such U.S. bellwethers
as Intel Corp and JPMorgan, and the euro vaulted to a lifetime
peak against the dollar on record euro zone inflation.
Oil fell from record highs near $115 a barrel as a build in
U.S. heating oil stocks countered concerns over declines in
crude and gasoline inventories.
Surging energy and food prices pushed euro zone inflation
to a new high of 3.6 percent in March, boosting the euro on
rapidly fading chances of an interest rate cut by the European
Central Bank in the near term.
That highlighted a growing interest rate differential with
the United States, where consumer prices moved up a bit less
than expected and left the Federal Reserve some room to cut
rates again to ward off a housing-led slowdown.
The number of U.S. housing projects started in March fell
to the lowest in 17 years, according to another report.
Euro zone and U.S. government debt prices fell on the back
of corporate results that reassured investors after recent
disappointments, especially in the hard-hit banking sector.
"When you see a tech bellwether, a consumer products
bellwether and a big financial all clocking in with good
numbers, it makes you a bit of a believer," said Edward
Bretschger, director of equity sales and trading at Calyon
Securities in New York.
The Dow Jones industrial average <> was up 191.42
points, or 1.55 percent, at 12,553.89. The Standard & Poor's
500 Index <.SPX> was up 20.76 points, or 1.56 percent, at
1,355.19. The Nasdaq Composite Index <> was up 53.23
points, or 2.33 percent, at 2,339.27.
At JPMorgan Chase & Co <JPM.N>, profit fell 50 percent. But
the third-largest U.S. bank was able to skirt the massive
losses that have crippled many rivals, and its shares rose.
The bank's problems paled compared to those at rivals such
as Citigroup Inc <C.N>, UBS AG <UBSN.VX> and Merrill Lynch & Co
<MER.N>. JPMorgan shares were up 4.6 percent in midday trade.
Intel <INTC.O> late on Tuesday affirmed its profit-margin
target for 2008, reassuring investors concerned about falling
memory chip prices and the impact of a weak U.S. economy,
sending its stock up 8 percent.
European shares ended sharply higher, driven by gains in
banks after JPMorgan's <JPM.N> results reassured worried
investors and by soaring commodity prices that lifted miners
and food oils.
The FTSEurofirst 300 <> index of top European shares
rose 1.65 percent to 1,302.78 points, with the commodity- and
bank-heavy British FTSE 100 <> also a strong outperformer,
gaining 2.36 percent.
Rio Tinto <RIO.L> rose 5.9 percent, Royal Bank of Scotland
<RBS.L> jumped 7.6 percent and Total <TOTF.PA> gained 2.4
percent, making them the top-weighted gainers on the
pan-European benchmark.
After recent poor results from General Electric <GE.N> and
Alcoa <AA.N>, earnings reports from Intel and JPMorgan
suggested that companies can manage despite a slowing U.S.
economy. But some investors said it was too early to sound the
all-clear.
"We remain cautious -- this is still a bear market rally,"
said Philippe Gijsels, senior equity strategist at Fortis Bank
in Brussels.
"There's lots of speculative money in the commodities space
-- equities are volatile, credit markets are difficult and cash
is not an option because of inflation," Gijsels said.
Asian stocks scored solid gains, with high-tech exporters
buoyed by the reassuring outlook from Intel and energy shares
underpinned by record high oil prices.
Japan's Nikkei average <> advanced 1.2 percent, and
MSCI's measure of Asia Pacific stocks outside Japan
<.MIAPJ0000PUS> rose 1.3 percent.
In debt trading, the benchmark 10-year U.S. Treasury note
<US10YT=RR> was down 10/32, with the yield at 3.6425 percent.
The two-year U.S. Treasury note <US2YT=RR> was down 2/32 in
price, with the yield at 1.9095 percent. The 30-year U.S.
Treasury bond <US30YT=RR> was down 10/32, with the yield at
4.4671 percent.
The dollar was down against a basket of major
trading-partner currencies, with the U.S. Dollar Index <.DXY>
down 0.93 percent at 71.354. The euro <EUR=> was up 1.10
percent at $1.5965 after peaking at $1.5977. Against the yen,
the dollar <JPY=> was down 0.20 percent at 101.61.
U.S. crude <CLc1> traded down 55 cents at $113.24 a barrel
at 12:27 p.m EDT (1627 GMT), after surging to a record $114.95
a barrel right after a U.S. government report on oil
inventories was released.
Brent crude <LCOc1> gave up 48 cents to trade at $111.10 a
barrel, off an all-time peak of $112.73 hit earlier.
Spot gold prices <XAU=> rose $17.50, or 1.89 percent, to
$945.50.
(Additional reporting by Caroline Valetkevitch, John Parry,
Steven C. Johnson in New York and Sitaraman Shankar, Bate Felix
and Pratima Desai in London; Editing by Jonathan Oatis)
