* World stocks rise 0.9 pct, spurred by Goldman profits
* Dollar down, commodities up as appetite for risk grows
* Lingering Greece concerns weigh on euro
By Walter Brandimarte
NEW YORK, April 20 (Reuters) - World stocks and oil prices
rose on Tuesday as strong corporate earnings fueled optimism
about the global economy, reducing safe-haven demand for the
U.S. dollar and the Japanese yen.
The Canadian dollar soared after the Bank of Canada
signaled it may raise interest rates as early as June, becoming
the first among the Group of 7 rich nations to indicate it will
raise rates as it cited recent improvements in the economic
outlook.
But persistent concerns about Greece's financial situation
knocked down the euro, also providing some support for Treasury
prices, which mostly fell after a recent rally.
News from Wall Street powerhouse Goldman Sachs Group Inc
<GS.N> that its earnings doubled in the first quarter helped
drive investor confidence that the economy is recovering. The
news deflected attention from fraud accusations against the
bank by U.S. regulators. []
Goldman results came a day after Citigroup Inc <C.N>
announced its best quarterly results in nearly three years.
"The focus from the Goldman Sachs investigation has shifted
back to earnings, the true driver of markets," said Andre
Bakhos, director of market analytics at Lek Securities in New
York. "Optimism about this earnings season seems to be coming
back into play."
Renewed optimism about the economy translated into higher
oil prices, which boosted energy shares on both sides of the
Atlantic and supported Wall Street's main stock indexes.
The Dow Jones industrial average <> ended up 25.01
points, or 0.23 percent, at 11,117.06 while the Standard &
Poor's 500 Index <.SPX> climbed 9.65 points, or 0.81 percent,
to 1,207.17. The Nasdaq Composite Index <> rose 20.20
points, or 0.81 percent, to 2,500.31.
Goldman Sachs' shares fell 2.1 percent despite its strong
results, as Britain's market watchdog launched its own probe on
the bank, but financial stocks overall were stronger, with the
KBW bank index <.BKX> jumping 2.7 percent.
Energy stocks rose as crude oil futures topped $83 a
barrel, with the S&P energy index <.GSPE> up 1.9 percent.
Still, gains were modest as investors found some cracks in
corporate results. International Business Machines Corp <IBM.N>
reported better-than-expected profits but its gross margins
disappointed investors, and its shares fell 1.9 percent.
Coca-Cola Co <KO.N> reported mixed results, and its shares
slipped 1.5 percent.
In Europe, the FTSEurofirst 300 index <> of top
shares ended 1.4 percent higher, with automakers boosted by
above-forecast results at Daimler <DAIGn.DE> and energy
companies gaining on the stronger crude prices.
"Results have driven shares higher. After a couple of down
days Citi came out with stellar results and people started
buying again," said Mic Mills, senior trader at ETX Capital.
The MSCI world equity index <.MIWD00000PUS> gained 0.9
percent while the MSCI index of emerging market stocks
<.MSCIEF> jumped 1.1 percent as commodity prices rose.
U.S. crude oil <CLc1> leaped $2, or 2.46 percent, to settle
at $83.45 per barrel, and spot gold prices <XAU=> rose 0.31
percent, to $1,138.10 an ounce. The Reuters/Jefferies CRB
Index <.CRB> of commodity futures gained 0.9 percent.
Oil investors have been studying broader financial markets,
like company shares, since last year for signs of economic
recovery that would point the way to higher fuel consumption.
GREECE CONCERNS WEIGH ON EURO
Greater risk appetite hurt the U.S. dollar, which was
trading nearly stable against a basket of major currencies,
according to the U.S. Dollar Index <.DXY>.
Against the Japanese yen, the dollar <JPY=> was up 0.79
percent at 93.16, a day after the Japanese currency reached a
one-month high against the greenback.
The Canadian dollar soared, with the greenback last trading
1.6 percent lower at C$0.9987 <CAD=>, after the Bank of Canada
abandoned its conditional commitment to keep rates steady until
the end of June. []
The euro <EUR=> weakened 0.3 percent to $1.3443, hurt by
concerns over debt troubles in Greece and other peripheral euro
zone economies like Portugal.
European Central Bank Governing Council member Axel Weber
denied reports that he had said Greece may require assistance
of up to 80 billion euros to avoid default, []
Weber said he had simply referred to a provisional figure
for a three-year period by the Greek Finance Ministry that had
since been revised, and his comments had been misinterpreted.
Still, yields on Greece's 10-year government bond
<GR10YT=TWEB> jumped above 8 percent for the first time since
Greece adopted the euro in 2001, driving the yield spread over
Bunds to a euro lifetime high of 491 basis points.
Those concerns also provided some safe-haven demand for
U.S. Treasuries, although prices of shorter-dated notes fell on
the earnings optimism.
The benchmark 10-year U.S. Treasury note <US10YT=RR> rose
1/32 in price, with the yield at 3.7974 percent. The 2-year
note <US2YT=RR> was down 2/32, with the yield at 1.0121
percent.
(Additional reporting by Rodrigo Campos; Editing by Leslie
Adler)
