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* U.S. stocks, MSCI's global equity gauge hit record highs
* STOXX 600 index in Europe hits record high
* Oil prices, Treasury yields move higher on trade prospects
By Herbert Lash
NEW YORK, Dec 16 (Reuters) - Global stock markets rallied on
Monday, lifting Wall Street's three major indexes and a global
gauge of equity performance to record highs after a preliminary
U.S.-China trade deal pointed to stronger global growth, helping
to drive up oil prices.
A pan-European index also hit a record high and the
landslide election victory last week by British Prime Minister
Boris Johnson pushed the benchmark FTSE 100 .FTSE to its
biggest single-day gain in more than three years.
Chinese stocks rose to a six-week closing high as investors
cheered the trade deal and growth in China's industrial and
retail sectors beat expectations in November. But gold held steady and the dollar eased as investors
sought clarity on the deal's fine print.
"It's good news but we can't celebrate yet," said Mark
Mobius, founding partner of Mobius Capital Partners and former
executive chairman of the Templeton Emerging Markets Group.
"This agreement is dependent on the degree to which the
Chinese comply. This conversation will continue as there's so
many issues," Mobius said.
The "phase one" deal suspended a threatened round of U.S.
tariffs on $156 billion of Chinese imports that was scheduled to
take effect on Sunday. The United States also agreed to halve
the tariff rate, to 7.5%, on $120 billion worth of Chinese
goods.
MSCI's gauge of stocks across the globe .MIWD00000PUS
gained 0.79% and the pan-European STOXX 600 index .STOXX rose
1.52% to hit record highs.
On Wall Street, the Dow Jones Industrial Average .DJI rose
164.32 points, or 0.58%, to 28,299.7. The S&P 500 .SPX gained
25.85 points, or 0.82%, to 3,194.65 and the Nasdaq Composite
.IXIC added 93.23 points, or 1.07%, to 8,828.11.
Apple Inc AAPL.O , among the biggest companies to benefit
from the deal, rose 1.87%. Chipmakers that make the components
for its iPhones also gained.
On Sunday, U.S. Trade Representative Robert Lighthizer said
the trade deal was "totally done" and that he expected it to
nearly double U.S. exports to China over the next two years.
For much of 2019 investors have fretted over fears of a
global recession, a good part driven by the prolonged U.S.-China
trade dispute, said Candice Bangsund, a portfolio manager of
global asset allocation at Fiera Capital in Montreal.
Equities are poised for further upside because of receding
trade headwinds and reinflationary efforts by the Federal
Reserve, the European Central Bank and the Bank of Japan, she
said.
"From a 'what's priced-in standpoint' it's reduced
uncertainty. What's not priced in, though, is the impact it's
going to have on the global economy," Bangsund said.
Britain's FTSE 100 .FTSE surged 2.7% in the largest
single-day gain since the immediate aftermath of the vote to
leave the European Union in June 2016, when the blue-chip index
rose 3.6% on a rally in stocks with global exposure.
Oil prices rose, supported by the announcement of an initial
U.S.-China trade deal.
Brent crude oil futures LCOc1 were up 25 cents to $65.47 a
barrel, while West Texas Intermediate crude CLc1 gained 11
cents to $60.18 a barrel.
Currency markets were mostly on hold.
The dollar index .DXY fell 0.13%, with the euro EUR= up
0.16% to $1.1137. The Japanese yen JPY= weakened 0.30% versus
the greenback at 109.66 per dollar.
U.S. Treasury yields rose as traders took an optimistic view
of a preliminary U.S.-China trade deal and its impact on growth.
Benchmark 10-year notes US10YT=RR last fell 19/32 in price
to yield 1.8853%.