Global stocks set record highs as oil jumps on inventory drop

NEW YORK (Reuters) – Global stock prices posted record highs for a third straight session on Thursday, propelled by an oil rally after a surprise drop in US crude inventories and comments by US Treasury Secretary Steven Mnuchin about pursuing significant tax reform.

The dollar was bogged down a day after minutes from the US Federal Reserve’s January 31-February 1 policy meeting showed the central bank was in no rush to raise interest rates.

Treasury and euro-zone government-bond yields declined as European Central Bank policy makers also signaled they were not getting carried away by signs the euro-zone economy is gathering strength.

This outlook for policy accommodation lifted gold prices to a three-month high near $1,250 an ounce.

Equity markets around the world have advanced this year as traders bet on tax cuts, less regulation and more infrastructure spending from US President Donald Trump and the Republican-controlled Congress to bolster the US economy.

Details on these stimulus programs have been sparse, raising doubts whether bigger corporate profits will materialize.

On Thursday, Mnuchin spoke of wanting to see “very significant” tax reform passed before Congress’s August recess. He said the Trump administration was looking closely at border-tax issues.

“That’s starting to put some details on tax reform,” said Bill Northey, the chief investment officer for the private-client group at US Bank in Helena, Montana. “That’s reigniting some of the animal spirits.”

The MSCI world equity index, which tracks shares in 46 nations, rose 0.48 points or 0.11%, to 446.52 after touching a record peak at 447.67.

On Wall Street, the Dow Jones Industrial Average booked an all-time intraday high for a 10th straight day, while S&P 500 touched a record high before retreating.

In late-morning trading, the Dow rose 22.48 points, or 0.11%, to 20,798.08, the S&P 500 lost 1.81 points, or 0.08%, to 2,361.01, and the Nasdaq Composite dropped 27.04 points, or 0.46%, to 5,833.58.

Europe’s broad FTSEurofirst 300 index dipped 0.07% to 1,471.82, scaling back further from its 14-month peak set on Wednesday.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.89 points ,or 0.19%, to 471.69 after reaching its highest since July 2015 earlier Thursday.

Gains in energy shares due to a jump in oil prices helped lift the equity market.

Brent crude was last up $1.18, or 2.11%, to $57.02 a barrel. US crude was last up $1.09, or 2.03%, to $54.68.

A weaker dollar in the wake of Fed minutes that were perceived as less hawkish whet appetite for gold and bonds.

Spot gold prices rose $8.80 or 0.71%, to $1,246.11 an ounce.