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Global shares rise on easing Ukraine tensions, cheaper oil

TOKYO (AP) – Global shares rose yesterday, buoyed by hopes that a diplomatic solution might avert a Russian invasion of Ukraine.

France’s CAC 40 edged up 0.7 per cent in early trading to 7,030.39. Germany’s DAX rose 0.8 per cent to 15,540.97. Britain’s FTSE 100 gained nearly 0.2 per cent to 7,621.99. The future for the Dow industrials was 0.3 per cent higher at 34,996.00. The S&P 500 future rose 0.3 per cent to 4,475.75.

But analysts warned the tensions were far from completely resolved, and the situation remains volatile.

“Provided we get a further pause in geopolitics, we might be able to focus on worrying data instead. But I would tread carefully on the assumption that we will be able to for long,” RaboResearch said in a report.

In Asia, Japan’s benchmark Nikkei 225 jumped 2.2 per cent to finish at 27,460.40.

Australia’s S&P/ASX 200 rose 1.1 per cent to 7,284.90. South Korea’s Kospi surged 2.0 per cent to 2,729.68. Hong Kong’s Hang Seng added 1.5 per cent to 24,718.90, while the Shanghai Composite gained 0.6 per cent to 3,465.83.

People cycling past an electronic stock board of a securities firm in Tokyo. PHOTO: AP

Investors have been preparing for the United States (US) Federal Reserve to start raising interest rates to fight inflation. The central bank is expected to start raising rates in March and traders see a 61-per-cent chance for a first hike of half a percentage point, double the traditional move.

Rising costs have been crimping operations for a wide range of businesses and prompting many to raise prices on finished goods from clothing to food. That has raised concerns that consumers could eventually pull back on spending, therefore hurting economic growth.

In energy trading, US benchmark crude surged USD1.09 to USD93.16 a barrel in electronic trading on the New York Mercantile Exchange. It slumped 3.6 per cent on Tuesday. Brent crude, the international standard, added USD1.20 to USD94.48 a barrel.

Oil prices have been volatile amid tensions over Russia potentially invading neighbouring Ukraine. Russia is a major energy producer and military action that disrupts supplies could jolt markets and global industries.

In currency trading, the US dollar rose to JPY115.75 from JPY115.63. The euro cost EUR1.1387, up from EUR1.1362.