* Euro zone leaders agree to terms of possible Greek loan
* Euro rises versus dollar on Greece bailout speculation
* US stocks rise, Dow touches 11,000 in 1st since Sept '08
* Bonds edge higher as Greece jitters spur safe-haven bids
* Oil retreats from 18-month highs on signs of weak demand
(Updates with close of U.S. markets)
By Herbert Lash
NEW YORK, April 9 (Reuters) - Global stocks rose on Friday,
posting gains for a sixth straight week, and the euro firmed
after sources said euro zone leaders agreed to terms of a
possible emergency loan for Greece and U.S. economic data
buoyed recovery hopes.
Greece would pay more than 6 percent to get emergency euro
zone loans for up to three years, and even more if the loan's
terms were longer, euro zone sources told Reuters.
[]
Hopes that an agreement on loan terms would help Greece
manage its fiscal problems sparked a rally that lifted the euro
to just shy of $1.35, its highest since Monday, and pushed
European equities up more than 1 percent.
On Wall Street, the Dow industrials touched the
psychologically important level of 11,000 for the first time
since September 2008, just minutes before markets closed,
though the blue chip index finished slightly below that mark.
Currency traders said the longer-term outlook for the euro
remained negative and U.S. Treasury prices edged higher in late
trade as persistent concerns about Greece fueled a safe-haven
bid for lower-risk government debt.
"Given all the uncertainties with the euro zone, no one
wants to be short Treasuries ahead of the weekend," said Larry
Milstein, head of government and agency trading at R.W.
Pressprich & Co. in New York.
Greek bonds outperformed German Bunds even as a Fitch
downgrade of Greek debt to one notch above junk status failed
to undermine investors' optimism after the sources confirmed
speculation of a emergency loan accord. []
Billionaire financier George Soros told Reuters that the
Greek debt crisis was solvable if Germany agreed that any
emerging lending would be made with concessionary interest
rates, as suggested by the standard IMF bailouts.
[]
But Firas Askari, head of FX trading at BMO Capital Markets
in Toronto, said any rescue of Greece is probably a poor one.
"By inviting the IMF to the party, one has to wonder what
the purpose of the European Union is," Askari said. "So I think
any rally in the euro is probably short-lived."
Global equities measured by MSCI's All-Country World Index
<.MIWD00000PUS> rose 1.1 percent, snapping two days of losses.
U.S. shares rose after an upbeat Chevron outlook, while
data that showed U.S. wholesale inventories rose more than
expected in February and sales by wholesalers reached their
highest level in 16 months brightened the economic and earnings
outlook. [].
"Economic data so far in April has been fairly
encouraging," said Michael Sheldon, chief market strategist at
RDM Financial in Westport, Connecticut, adding that investors
want to know if the economy is producing sustainable growth.
The Dow Jones industrial average <> closed up 70.28
points, or 0.64 percent, at 10,997.35. The Standard & Poor's
500 Index <.SPX> gained 7.93 points, or 0.67 percent, at
1,194.37. The Nasdaq Composite Index <> rose 17.24 points,
or 0.71 percent, at 2,454.05.
The dollar was down against a basket of major currencies,
with the U.S. Dollar Index <.DXY> down 0.77 percent at 81.906.
Against the yen, the dollar <JPY=> was down 0.24 percent at
93.16.
Gold rose to the highest level this year as the Fitch
downgrade of Greece's debt revived fears over the euro zone's
financial stability and prompted a flight to safety.
Spot gold peaked at a four-month high at $1,164.35 an
ounce, the firmest since Dec. 8.
June gold futures settled up $9 at $1,161.90 an ounce on
the COMEX division of the New York Mercantile Exchange.
The benchmark 10-year U.S. Treasury note <US10YT=RR> was up
1/32 in price to yield 3.88 percent.
Oil prices fell for a third day and retreated further from
18-month highs as bloated inventories stoked concerns about
weak demand and technical signals sparked a sell-off.
[]
The downturn erased early gains fueled by economic optimism
and a weaker dollar.
Front-month U.S. crude <CLc1> fell 47 cents to settle at
$84.92 a barrel, posting a tiny 5 cent gain on the week and
finishing higher for the second straight week.
In London, ICE Brent crude <LC0c1> closed 2 cents up at
$84.83, after two days of losses.
(Reporting by Leah Schnurr, Steven C. Johnson, Richard Leong
and Gene Ramos in New York; Brian Gorman and William James in
London; writing by Herbert Lash; Editing by Leslie Adler)
