Global shares rise on Greek debt hopes; U.S. yields rise
NEW YORK (Reuters) - U.S. and European shares rose on Tuesday on reports of a possible debt agreement between Greece and its major creditors, while U.S. Treasury yields rose on continued expectations of a Federal Reserve rate hike this year.
Reports of a possible agreement between Greece and its international creditors, including an MNSI report that the EU Commission will propose a six-month debt extension, helped shares rebound ahead of a meeting of the bloc's finance ministers Wednesday.
German Finance Minister Wolfgang Schaeuble, however, denied reports Greece had come to an agreement with the Commission and said the ministers would not negotiate a new program for Athens when they meet.
Coca-Cola Co shares boosted the Dow and the S&P 500 after the company reported a bigger-than-expected profit and its first increase in North American sales, its biggest market, in four quarters. Shares were last up 3 percent at $42.45. A drop in energy shares on declining oil prices capped U.S. stock gains, however.
"Anything that makes us believe we can avoid a sloppy Greek exit is going to be a positive for markets overall, and that is where we are at right now," said Art Hogan, chief market strategist at Wunderlich Securities in New York.
U.S. Treasury yields rose, with benchmark 10-year note yields surpassing 2 percent to their highest in a month on heightened expectations that the Fed, the U.S. central bank, would hike rates from rock-bottom lows this year after strong U.S. jobs data last Friday.
"We are still showing some of the hangover from the good nonfarm payrolls report on Friday," said Guy LeBas, chief fixed income strategist at Janney Montgomery Scott LLC in Philadelphia.
Oil prices slipped, ending a three-day rally, after the International Energy Agency warned of more selloffs in the near term as crude stocks continue to rise. Analysts polled by Reuters estimated U.S. commercial crude stockpiles likely rose 3.8 million barrels to a record high last week.
The Dow Jones industrial average was last up 0.5 percent, at 17,818.57. The S&P 500 was up 0.67 percent, at 2,060.44 and the Nasdaq Composite was up 0.92 percent, to 4,769.69.
In Europe, the FTSEurofirst 300 index of top regional shares ended 0.57 percent higher, at 1,488.39. MSCI's all-country world stock index was last up 0.31 percent, at 420.16.
The rise in Treasury yields helped the U.S. dollar hit a one-month peak against the safe-haven Japanese yen of 119.61 yen. The dollar index , which tracks the greenback versus a basket of six currencies, was last up 0.29 percent, at 94.726.
Data overnight showing Chinese inflation fell to a five-year low provided support for expectations of further policy easing by Beijing to protect growth. Shanghai shares rose more than 1 percent but stocks in the rest of Asia declined.
Brent crude was last down $1.22 at $57.12 a barrel. U.S. crude was last down $2.08 at $50.78 per barrel.
The uptick in the dollar led gold to stall the previous day's rise, preventing a steeper recovery from Friday's three-week low. Spot gold prices were last down $5.48, at $1,233.45 an ounce.
(Reporting by Sam Forgione; Additional reporting by Marc Jones in London and Chuck Mikolajczak and Michael Connor in New York; Editing by James Dalgleish and Andrew Hay)