Global Stocks Buoyed by Gains in Energy, Tech

By David Hodari Features Dow Jones Newswires

Brent crude hits 2 1/2 -year high

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-- Energy, tech upbeat in Europe, U.S.

-- Investors look to central banks

U.S. energy stocks were on course to replicate the gains made by the sector in European indexes Tuesday amid rising oil prices.

S&P 500 futures were up 0.1% in premarket trade, as the Stoxx Europe 600 gained 0.3%, shrugging off broadly downbeat trading in Asia.

In the U.S., TechnipFMC was on course for a 2.1% increase and Marathon Oil was set to open 1.7% higher. The Stoxx Europe 600's oil-and-gas sector rose 1.4%, with Statoil up 3.4% and Tullow Oil up 2.9%.

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Brent crude, the global benchmark, gained 1.6% to $65.74 a barrel after surpassing $65 a barrel Monday for the first time since June 2015. That followed the news that the major Forties North Sea pipeline will temporarily close after a fracture was found.

The European tech sector received a boost, with shares in French IT firm Atos up 5% on its bid for Dutch software firm Gemalto, which itself leapt 33%. The Stoxx Europe 600 technology sector rose 1%.

U.S. tech firms also looked likely to lead early gains. Gaming company Activision Blizzard was set to gain 2.5%, and data storage company Seagate Technology was heading for a 1.7% increase.

Otherwise, trading was mild as investors awaited cues from global central banks. The U.S., European, and U.K. central banks, among others, are scheduled to meet this week, with European Central Bank President Mario Draghi due to give a speech Tuesday.

"The main focus from Draghi is that we'll get new economic forecasts and we'll get 2020 [forecasts] for the first time. he may also give more detail on how [the ECB] plans to scale back purchases to EUR30 billion [$35 billion] from EUR60 billion. Will they halve all purchases or take a more nuanced approach?" said James Knightley, chief international economist at ING.

Also scheduled for Tuesday was the start of the Federal Open Market Committee's two-day meeting, with the body's interest rate decision due Wednesday. Data from CME Group showed investors were betting on a 100% probability that the Fed will announce a rate increase.

Fed observers should not expect many surprises in the months ahead either, said Mark Richards, a global multiasset strategist at J.P. Morgan Asset & Wealth Management. December's meeting will be the last for multiple FOMC members, and given an impending change in chairperson in January, "it doesn't feel like a new Fed chair will seek to alter the policy path materially, so we expect [the current guidance of three hikes] to be maintained for a good few months."

U.S. 10-year Treasury yields ticked up to 2.393% from 2.387% late Monday, while German 10-year bond yields moved up to 0.306% from 0.288%. Yields move inversely to prices.

Rising oil prices helped Australia's commodities-heavy S&P/ASX 200 index buck the negativity of the broader Asia-Pacific region and finish 0.2% higher.

Asian tech stocks drove a reversal of early-week gains. Hong Kong's Hang Seng Index fell 0.6%, dragged lower by heavyweight Tencent Holdings. The tech giant fell 3% after disclosing that one of its units is in talks to acquire a minority stake in supermarket operator Yonghui.

Taiwan's tech-heavy Taiex fell 0.3% and Korea's Kospi slipped 0.4%, despite a 0.6% gain for index heavyweight Samsung Electronics. Japan's Nikkei closed 0.3% lower partly thanks to a slight drop in the yen against the dollar.

Regional selling also dragged on Chinese stocks, with the Shanghai Composite down 1.3% and the Shenzhen Composite down 1%. That came despite credit data released late Monday showing resilient bank lending in November.

Bitcoin prices slipped after Securities and Exchange Commission Chairman Jay Clayton warned about the risks to retail investors in the red-hot cryptocurrency. Coindesk's Bitcoin USD Price Index was recently up 0.6% at around $16,795.23 after nearing $17,400 in late New York trading.

Gregor Stuart Hunter contributed to this article.

Write to David Hodari at David.Hodari@dowjones.com

(END) Dow Jones Newswires

December 12, 2017 09:02 ET (14:02 GMT)