* U.S. retail sales bolsters global stocks
* Solid earnings by JPMorgan, Intel aid recovery view
* Greece, Portugal concerns hang over market
(Updates with U.S. close)
By Al Yoon
NEW YORK, April 14 (Reuters) - World stocks rallied to more
than 1-1/2-year highs on Wednesday and oil rose more than 2
percent to snap a five-day losing streak as unexpected strength
in U.S. consumer spending and earnings at JPMorgan Chase and
Intel drove optimism on the the economic recovery.
U.S. Treasuries prices fell as the surge of optimism over
the economy dented any safety bid.
In New York, the benchmark S&P 500 index pushed past the
1,200 mark for the first time in 18 months and more stocks hit
a 52-week high on the New York Stock Exchange than on any day
since late December 2003.
Investors remained cautious about Greece's debt, however,
and pushed risk premiums on the nation's bonds higher despite a
European Union rescue plan hammered out last weekend.
The U.S. government reported retail sales jumped 1.6
percent in March, the largest increase since November, as
consumers stepped up purchases of vehicles and a wide range of
goods. The data, which topped analysts' estimate for an
increase of 1.2 percent, lifted hopes for consumer spending,
which drives about two thirds of U.S. economic activity.
"This whole rally is being vindicated by earnings which
have been phenomenal, and the comeback of the consumer," said
Keith Springer, president of Capital Financial Advisory
Services in Sacramento, California.
Intel's <INTC.O> forecast-beating results late on Tuesday
reinforced hopes for an acceleration in the tech sector's
recovery. []. Its shares rose 3.3 percent.
JPMorgan <JPM.N> stock jumped 4 percent, making it the top
performer among the Dow industrials, after it reported earnings
that topped estimates.
Indexes of financial shares and technology shares led gains
on the Standard & Poor's 500 index.
The S&P <.SPX> increased closed up 13.35 points, or 1.12
percent, to 1,210.65. The Dow Jones industrial average <>
rose 103.69 points, or 0.94 percent, to 11,123.11, also the
highest since September 2008, and the Nasdaq Composite Index
<> climbed 38.87 points, or 1.58 percent, to 2,504.86.
In Europe, the pan-European FTSEurofirst 300 <>
gained 0.6 percent to reach an 18-month closing high at
1,105.32 points.
Banking and tech stocks also led the rally in Europe,
rising on the strength of the U.S. results. Dutch chip
equipment maker ASML <ASML.AS> reported that its first-quarter
orders beat the most optimistic expectations.
"It looks like nothing is going to stop this market from
going higher at the moment, anyway, even any possible Greek
debt default," said David Morrison, market strategist at GTF
Global in London.
World stocks as measured by MSCI <.MIWD00000PUS> gained 1.2
percent to its highest level since the financial crisis was
coming to a head in September 2008. Its emerging market
counterpart <.MSCIEF> rose more than 1.2 percent.
Japan's Nikkei <> gained 0.39 percent.
GREECE PRESSURE
Greece's debt problems were again in focus, despite the
European Union's rescue plan outlined at the weekend.
The premium investors' demand to buy 10-year Greek
government bonds rather than benchmark German Bunds rose to the
highest level since the euro zone on Sunday inked an aid deal
for Greece. Portuguese bond yields also rose as the EU said
Portugal, also heavy with debt, may need fiscal cuts.
The Portuguese 10-year bond yield <PT10YT=RR> rose about
0.08 percentage point to 4.44 percent <PT10YT=RR>, taking the
yield premium over German Bunds to 1.3 percentage points.
The Greek 10-year bond yield <GR10YT=TWEB> drifted above 7
percent from around 6.8 percent on Tuesday, with the spread to
German Bunds nearing 4 percentage points.
Greece raised 1.56 billion euros via a 26- and 52-week
T-Bill auction, paying a hefty yield. []
In other bonds, U.S. Treasury debt prices wavered as tame
inflation data for March soothed concerns that rising prices
could force interest rates higher, while signs of economic
strength in retail sales weighed. Yields on benchmark 10-year
Treasury notes rose 0.05 percentage point to 3.83 percent.
The U.S. government said consumer prices rose 0.1 percent
in March, matching economists' expectations for a tame reading
and giving the Federal Reserve leeway to maintain ultra-low
interest rates. For details see []
The euro pared gains against the dollar after rating agency
Moody's told Reuters there was still a greater than 50 percent
chance of a rating cut for debt-stricken Greece in the next 12
to 18 months. []
The dollar fell against the euro after Federal Reserve
Chairman Ben Bernanke struck a cautious tone on the economy in
in Congressional testimony and reiterated that U.S. interest
rates will stay low for some time.
Late in New York, the dollar fell against a basket of major
trading-partner currencies, with the U.S. Dollar Index <.DXY>
was off 0.4 percent. The euro <EUR=> rose 0.35 percent to
$1.3654, and against the yen the dollar <JPY=> declined 0.05
percent to 93.16 yen.
Oil prices rose to trade around $85 a barrel, as a surprise
decline in U.S. crude inventories added to optimism about the
economy after the U.S. data.
U.S. light sweet crude oil <CLc1> settled up $1.79, or 2.13
percent, to $85.84 per barrel.
Spot gold prices <XAU=> rose $5.25, or 0.46 percent, to
$1,155.40.
(Additional reporting by Jon Hopkins and Jeremy Gaunt in
London; Editing by Leslie Adler)
