* Global stocks gain after Fed, BoJ spur risk appetite
* Dollar eases after Fed reiterates low rate pledge
* Oil tops $82 as OPEC leaves output targets unchanged
* Long-dated Treasuries rise as U.S. producer prices fall
(Updates with open of U.S. markets; changes byline, dateline,
previous LONDON)
By Herbert Lash
NEW YORK, March 17 (Reuters) - World stocks rallied and
commodity prices jumped on Wednesday after a benign reading of
U.S. inflation added weight to the Federal Reserve's commitment
to keep interest rates low for an extended time.
The U.S. dollar extended its decline against most major
currencies following the Fed's renewed rate pledge on Tuesday,
while the yen slipped after the Bank of Japan eased policy. For
details see: []
Longer-dated U.S. Treasuries rose modestly as the latest
data on U.S. producer prices reinforced the perception that
inflation is a remote threat to the U.S. economy.
[]
The U.S. Labor Department said the index for prices paid at
the farm and factory gate fell 0.6 percent last month, the
largest decline since July, after it increased 1.4 percent in
January. Tumbling energy costs pushed produce prices lower.
With no rate increases in sight and inflation not a worry,
investors were encouraged to increase their risk appetite.
"Markets are under the assumption the economy will continue
to grow," said Steve Goldman, market strategist at Weeden & Co
in Greenwich, Connecticut. "Interest rates are not impeding the
advance."
MSCI's all-country world stock index <.MIWD00000PUS>
extended early gains, rising almost 0.8 percent. Shares on Wall
Street rose and European equity markets hit a two-month high,
with banks benefiting from the Fed's rate stance.
[]
Earlier Japan's Nikkei <> closed up 1.17 percent,
boosted by the BoJ's decision to loosen monetary policy.
Within an hour of opening, the Dow Jones industrial average
<> was up 39.53 points, or 0.37 percent, at 10,725.51. The
Standard & Poor's 500 Index <.SPX> was up 5.62 points, or 0.48
percent, at 1,165.08. The Nasdaq Composite Index <> was up
11.24 points, or 0.47 percent, at 2,389.25.
Mining stocks tracked metals higher. Copper hit a one-week
high as the dollar eased, inventories fell and talk of a
Chinese yuan revaluation helped boost sentiment.
[]
Oil extended gains to above $82 a barrel after the
Organization of Petroleum Exporting Countries decided to leave
production targets unchanged, and Saudi Arabia's oil minister
described crude prices as "beautiful." []
OPEC, which pumps roughly one in every three barrels of
oil, agreed at its meeting in Vienna to keep record output
curbs of 4.2 million barrels per day in place, even though
higher prices have seen members pump extra oil.
U.S. light sweet crude oil <CLc1> rose 91 cents to $82.61 a
barrel.
Gold prices retreated from earlier highs as the decline in
U.S. producer prices helped the dollar to recover losses versus
the euro. []
Spot gold prices <XAU=> were up $1.15 at $1125.80 an
ounce.
The dollar was down against a basket of major currencies,
with the U.S. Dollar Index <.DXY> down 0.10 percent at 79.671.
The euro <EUR=> was down 0.06 percent at $1.3761. Against
the yen, the dollar <JPY=> was up 0.25 percent at 90.50.
The benchmark 10-year U.S. Treasury note <US10YT=RR> was up
2/32 in price to yield 3.65 percent.
(Reporting by Rodrigo Campos, Gertrude Chavez-Dreyfuss and
Richard Leong in New York; David Sheppard in London; Writing by
Herbert Lash; Editing by Padraic Cassidy)
