Yellen spurs global stock rally as dollar tumbles

Stocks jumped around the world after Federal Reserve Chair Janet Yellen reasserted the central bank's gradual approach to raising interest rates. Commodities climbed as the dollar extended its worst month in more than five years.

Yellen's signal that weakening world growth calls for a slow approach to tightening policy ignited gains for shares from Shanghai to Frankfurt after U.S. equities erased their losses for the year. Diminishing prospects for a first-half Fed rate increase sent the Bloomberg Dollar Spot Index toward the lowest since June and drove emerging-market currencies toward their best month since 1998. Credit markets rallied and U.S. oil gained for the first time in five days.

Futures show traders now see no chance of Yellen changing policy next month and only a 54 percent likelihood of an increase by November after she dialed back some of the commentary made by other officials the past two weeks. The Fed chair emphasized during her appearance at the Economic Club of New York that the central bank remains wary of raising rates amid threats to American growth from a slowing global economy.

"We have seen European markets broadly head higher on Yellen's dovish note last night," said Michael Hewson, the London-based market analyst at CMC Markets Plc. "It's the only factor driving them up today."

The MSCI All-Country World Index added 0.8 percent as of 10:29 a.m. London time for a fourth-straight advance. The Shanghai Composite Index gained 2.8 percent and Germany's DAX Index added 1.6 percent. The Bloomberg Dollar Spot Index fell 0.2 percent.

The Stoxx Europe 600 Index climbed 1.2 percent, headed for a 2.1 percent advance for March. Commodityrelated shares posted the biggest gain of the 19 industry groups on the equity benchmark, with Anglo American Plc and Rio Tinto Group rising more than 5 percent. Energy companies rebounded as oil recovered.