* Euro gains on expectations of rise in interest rates
* Stocks buoyant, Wall Street starts higher
* Commodities power higher; gold hits record high
* Portugal sells 1 bln euros in T-bills, yields spike
(Updates prices, adds details)
By Leah Schnurr
NEW YORK, April 6 (Reuters) - The euro rallied on Wednesday
ahead of an expected interest rate hike in the euro zone, while
the weaker dollar and geopolitical unrest sent oil and gold
prices to fresh peaks.
The euro surged more than 1 percent to an 11-month high
against the Japanese yen <EURJPY=>, one day before the European
Central Bank is widely expected to raise its benchmark interest
rate by 25 basis points to curb inflation pressures.
The ECB has held rates at a record low 1.0 percent since
July 2008. The Bank of Japan, on the other hand, is expected to
keep interest rates low at its policy meeting on Thursday
following last month's massive earthquake and tsunami, and more
losses are expected for the yen.
<ECBWATCH>
Unrest in the Middle East and North Africa continued to
drive safety bids. A weaker greenback also makes dollar-priced
assets more affordable to holders of the euro and other
currencies.
"Central bankers will always claim that they have no
influence on oil prices but recent history has repetitively
shown that in the new world, where commodities are a global
asset, central bankers can have a greater influence on oil
prices than OPEC," said Olivier Jakob from Petromatrix.
The euro jumped to 122.15 yen and is up about 12.4 percent
against the currency so far this year, according to Reuters
data. It last traded at 122.08 yen, up 1.1 percent on the day.
The Reuters-Jefferies CRB index <.CRB>, which tracks 19
markets, rose to a one-month intraday high and was most
recently trading up 0.1 percent.
Spot gold <XAU=> rose to a record high, silver <XAG=>
touched a 31-year high, and Brent crude <LCOc1> rose $1 to
break through $123 a barrel, its highest level since August
2008. U.S. crude <CLc1> rose above $109 to its highest since
September 2008.
Global equities gained on a generally brighter economic
picture. U.S. stocks struggled to hold earlier solid gains in
late morning as investors refrained from making big bets before
corporate earnings season next week provides the next catalyst
for stocks. Mining shares rose with gold prices.
Portugal added to the positive tone after the battered euro
zone peripheral economy successfully sold six- and 12-month
treasury bills but had to pay a steep price in interest.
[]
Emerging markets also rose, helped by renewed interest due
to higher expectations for interest rates in developed markets.
Shares of European banks rose after the successful Portuguese
debt auction. For details, see []
World stocks as measured by MSCI <.MIWD00000OOPUS> were up
0.5 percent percent, while the S&P 500 <.SPX> was up 0.3
percent. Emerging markets <.MSCIEF> rose 0.9 percent and
Europe's FTSEurofirst 300 <> provisionally closed up 0.3
percent.
The Dow Jones industrial average <> added 8.93 points,
or 0.07 percent, to 12,402.83. The Standard & Poor's 500 Index
<.SPX> edged up 0.22 points, or 0.02 percent, at 1,332.85. The
Nasdaq Composite Index <> put on 1.17 points, or 0.04
percent, to 2,792.36.
"There is really no significant news that is going to drive
stocks until earnings comes out," said Jack Ablin, chief
investment officer, Harris Private Bank in Chicago.
"Next week it kicks off and that to me is wild card, costs
have gone up and analysts continue to ratchet profit
expectations higher."
Data showing that German industrial orders soared above
expectations in February brightened the outlook for Europe's
top economy. Orders grew by 2.4 percent on the month, compared
to the Reuters forecast for an increase of 0.6 percent.
[].
Portugal sold a total of 1.005 billion euros ($1.43
billion) in 12-month and six-month T-bills, but yields rose
sharply from previous auctions last month.
The 12-month T-bill yield rose to 5.902 percent from 4.331
percent in the previous auction three weeks ago, while the
yield on the shorter maturity rose to 5.117 percent from 2.984
percent in a sale in early March.
Demand, however, outstripped supply by 2.6 times for the
12-month t-bills and by 2.3 times for the six-month T-bills.
(Additional reporting by Rodrigo Campos, Nick Olivari and
Barani Krishnan in New York, Dmitry Zhdannikov in London;
Editing by Leslie Adler)
