* U.S. shares rise on jobs report, Fed's funding moves
* Oil rebounds more than $4 as U.S. gasoline stocks drop
* Dollar rises broadly on surprisingly strong jobs data
* U.S. government debt falls, but euro zone debt rises
(Adds close of U.S. markets)
By Herbert Lash
NEW YORK, July 30 (Reuters) - The dollar and global stocks
gained on Wednesday, shrugging off a sharp rebound in the price
of crude oil, after U.S. and European central banks again moved
to ease persistent credit strains.
Crude jumped more than $4 a barrel after U.S. government
data showed an unexpected drop in gasoline stocks as suppliers
facing weak consumer demand cut production and imports.
The rise in crude prices spurred oil shares to lead the Dow
and broad S&P 500 more than 1 percent higher.
Equities were bolstered and treasuries pressured early in
the U.S. day after the private sector ADP report showed
payrolls were stronger than expected.
The liquidity move by the Federal Reserve, and European and
Swiss central banks also lifted stocks, as did the extension
through Aug. 12 of an emergency rule aimed at curbing short
selling in the shares of 19 financial companies.
"The Fed has expanded its measures and it signals very
clearly that it will do everything to support the financial
system," said Rainer Sartoris, an economist at HSBC Trinkaus.
"This has a positive impact on the stock markets. Investors
are now hoping again for more stability," he added.
Bank shares went up and down in volatile trading before
closing strong in a final flourish.
U.S. securities regulators also extended through Aug. 12 an
emergency rule aimed at curbing abusive short selling in the
shares of 19 financial firms, including battered U.S. mortgage
finance companies Fannie Mae <FNM.N> and Freddie Mac <FRE.N>.
Shares of Fannie and Freddie initially rose more than 7
percent, pared most of those gains, and then rallied. Fannie
closed up 5.3 percent and Freddie ended up 3.7 percent.
The Dow Jones industrial average <> rose 186.37 points,
or 1.64 percent, at 11,583.93. The Standard & Poor's 500 Index
<.SPX> added 21.06 points, or 1.67 percent, at 1,284.26. The
Nasdaq Composite Index <> gained 10.10 points, or 0.44
percent, at 2,329.72.
The rally on Wall Street accelerated in the last half hour
as traders reversed bets that stocks would fall, which is known
as short covering. The late gains helped pull the Nasdaq out of
negative territory.
European shares rose sharply on the central banks' efforts
to boost emerging bank funding and on upbeat results from
industrial bellwethers Siemens <SIEGn.DE> ArcelorMittal
<MTP.PA><ISPA.AS>, the world's largest steelmaker.
ArcelorMitta reported record second-quarter earnings that
easily exceeded expectations as it managed to raise prices and
offset raw material costs.
The steelmaker's shares rose more than 8 percent and added
the most to the pan-European FTSEurofirst 300 index <>,
which ended up 1.6 percent at 1,180.75 points.
"The corporate results are on balance still a little better
than expected. Profitability has clearly deteriorated but it's
not the utter and complete disaster people expected," said Mike
Lenhoff, chief strategist and head of research at Brewin
Dolphin Securities.
Oil rebounded strongly after supply figures came out at
late morning. The U.S. Energy Information Administration said
gasoline inventories fell by 3.5 million barrels compared with
forecasts of a 200,000 barrel build, as U.S. gasoline
production dropped and imports fell.
U.S. crude <CLc1> settled up $4.58 at $126.77 a barrel
after falling to $120.42 on Tuesday, its lowest since May 6.
London Brent crude <LCOc1> rose $4.39 to settle at $127.10.
Gold futures ended 1.5 percent lower, erasing some early
losses, as a stronger dollar and equity gains prompted
selling.
Gold for the most-active December contract <GCZ8> settled
down $14.10 at $912.30 an ounce in New York. The August
contract for gold <GCQ8> hit a bottom of $893.30.
The dollar edged higher on the ADP jobs report and ongoing
efforts by monetary authorities to ease financial market
stress. But dollar gave up some gains on oil's surge.
The report raised prospects of improved non-farm payrolls
data, set for release on Friday, but analysts said ADP is not a
reliable indicator of what might happen to non-farm payrolls.
"The ADP number is bullish for the U.S. dollar especially
in an environment where we've seen in the last few weeks U.S.
data surprising on the upside," said Matthew Strauss, senior
currency strategist at RBC Capital Markets in Toronto.
The ADP National Employment Report showed companies added
9,000 jobs in July, compared with a revised 77,000 drop in
June. Analysts polled by Reuters had forecast a 60,000 fall.
The dollar rose against major currencies, with the U.S.
Dollar Index <.DXY> up 0.02 percent at 73.296. Against the yen,
the dollar <JPY=> fell 0.01 percent at 108.09.
The euro <EUR=> fell 0.08 percent at $1.5576.
The benchmark 10-year U.S. Treasury note <US10YT=RR> fell
1/32 to yield 4.05 percent. The 30-year U.S. Treasury bond
<US30YT=RR> fell 8/32 to yield 4.64 percent.
Stocks overnight in Asia rose on a decline in oil prices
and a rebound in U.S. bank shares. Japan's Nikkei average
<> closed up 1.6 percent while stocks elsewhere in Asia,
gauged by MSCI's index, rose 1.5 percent <.MIAPJ0000PUS>.
(Reporting by Lucia Mutikani, Richard Leong and Frank Tang in
New York and Santosh Menon, Ian Chua and Eva Kuehnen in
London)
(Writing by Herbert Lash. Editing by Richard Satran)
