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 Investors also breathed a sigh of relief as Greece confirmed it will
pay a 450 million-euro loan tranche to the International Monetary
Fund on Thursday, meeting a deadline and taking the immediate heat
off the cash-strapped country.
In early trading, Europe's EuroFirst 300 index of leading shares was
up 0.5 percent at a seven-year high of 1,619 points <.FTEU3>,
putting the index on track for its ninth weekly gain in the last 10.
Britain's FTSE 100 <.FTSE> and Germany's DAX <.GDAXI> were also both
0.5 percent higher at 6,972 points and 12,094 points, respectively.
"The fundamental upward trend in German industry is intact, despite
some monthly volatility," said Andreas Rees, chief German economist
at UniCredit.
German industrial production rose, while imports and exports both
grew faster than expected in February, data on Thursday showed. Auto
industry figures published late on Wednesday, meanwhile, showed that
the auto sector's recovery is broadening to France, Spain, Italy and
Portugal.
Earlier in Asia, MSCI's broadest index of Asia-Pacific shares
outside Japan <.MIAPJ0000PUS> gained 0.7 percent to its highest
since mid-September. That marks nine straight winning sessions, its
best run since September 2013.
Japanese stocks rose 0.75 percent to a 15-year high, while Hong Kong
<.HSI> powered up 2.7 percent to a seven-year peak. Hong Kong is up
nearly 7 percent so far this week, by far its best week since
December 2011.
Futures pointed to a lower open on Wall Street, however, with
investors concerned that the recent strength of the U.S. dollar will
have a detrimental effect on the first-quarter earnings season,
which got underway on Wednesday <SPc1>.
UK ELECTION JITTERS SOAR
Currency traders focused on the "hawkish" side of the Federal
Reserve's last policy meeting minutes, which suggested a June rate
hike is still on the table. The dollar index <.DXY> was up 0.5
percent, its fourth consecutive daily rise and its longest winning
streak in three months.
Fed officials acknowledged risks from overseas and a weak start to
the year at their March meeting. But they remained confident enough
in the strength of the recovery to continue laying the groundwork
for an interest rate hike later this year, according to minutes from
the meeting released on Wednesday.
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The euro fell further from around $1.10, down a third of a percent
on the day to $1.0740. Sterling shed 0.5 percent to $1.4785.
Volatility in sterling options markets rose to levels not seen for
years, as investors sought protection against swings in the currency
as Britain's May 7 general election approaches.
One-month euro/sterling implied volatility surged to its highest in
six years, and sterling/dollar volatility to its highest since
September 2011.
Opinion polls show the ruling Conservatives and the opposition
Labour neck-and-neck, making a hung parliament and a lengthy period
of uncertainty likely.
In bonds, benchmark 10-year U.S. Treasury yields were little changed
at 1.90 percent. Greek yields fell as Athens confirmed it will meet
its IMF repayment deadline and investors turned their attention to
sale of long-term Spanish debt later in the day.
"The news on Greece is helping push European markets higher,
although it doesn't mean at all that a long-term solution has been
reached," said Alexandre Baradez, chief market analyst at IG France.
Crude oil took back some lost ground following a plunge overnight
triggered by a rise in U.S. stocks and news of record Saudi oil
production.
U.S. crude was up 1.8 percent at $51.34 a barrel after shedding
nearly 7 percent on Wednesday. Brent rose about 2 percent to $56.67.
(Reporting by Jamie McGeever; Additional reporting by Blaise
Robinson in Paris; Editing by Larry King)
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