* U.S. stocks mostly higher, MSCI world equity index up
* U.S. ADP report helps sentiment, oil firmer
* Yen jumps on BoA concerns as does gold
(Updates with U.S. closing market activity, comments)
NEW YORK, May 6 (Reuters) - U.S. stock and crude oil
markets rallied on Wednesday as a U.S. report indicating
private sector job losses in April were slowing gave investors
another sign the worst of the recession may be past.
The gains in major U.S. stock indexes mirrored advances
elsewhere in the world with the benchmark MSCI world equity
index <.MIWD00000PUS> staying close to a 4-month high, helped
by better-than-expected results from BNP Paribas and rising
optimism that capital shortfalls at banks will be manageable.
Currency investors took a different view, however, with the
low-yielding yen, which typically strengthens when investors
wish to avoid risk, rising after a source familiar with the
result of a U.S. banking stress test told Reuters Bank of
America <BAC.N> has a capital shortfall of $34 billion.
Gold investors were also expressing caution, sending the
price of bullion higher ahead of the release of the stress test
results on Thursday.
"The results that are coming tomorrow are priced in," said
John Schloegel, vice president of investment strategies for
Capital Cities Asset Management in Austin, Texas.
The Dow Jones industrial average <> rose 101.55 points,
or 1.2 percent, to 8,512.20. The Standard & Poor's 500 Index
<.SPX> gained 15.72 points, or 1.7 percent, to 919.53. The
Nasdaq Composite Index <> rose 4.84 points, or 0.8
percent, to 1,759.10.
While the capital shortfalls at 19 of the largest U.S. bank
are much larger than analysts had expected, investors now have
more clarity on how well the industry will cope with the most
severe recession since World War II.
Bank of America <BAC.N> shares rose 17.1 percent. Shares in
Citigroup <C.N>, which may need $5 billion according to a
person familiar with the matter, rose 1.16 percent.
[].
Energy shares also gave the broad market a lift as crude
rose. Chevron <CVX.N> gained 3.6 percent.
Walt Disney Co <DIS.N> gained 11.8 percent after the No. 1
U.S. entertainment company posting a quarterly profit above
Wall Street's forecasts on Tuesday.
ADP GOOD NEWS
The solid jobs data impacted several asset classes.
[].
Oil investors focused on the positive economic news, with
U.S. June crude futures <CLc1> rising $2.42 cents to $56.26 a
barrel on the New York Mercantile Exchange as government
inventory data showed gasoline stocks fell last month, adding
to hopes of an economic recovery.
While U.S. Treasury debt prices initially fell on the data,
they later turned higher after stronger than expected demand in
an auction of 10-year notes.
The benchmark 10-year Treasury notes <US10YT=RR> rose 2/32
at 96-19/32. Their yield, which moves inversely to their price,
was at 3.15 percent, down from 3.16 percent late on Tuesday.
In other regional share markets, the FTSEurofirst 300 index
<> rose 1.4 percent on the day while emerging stocks
<.MSCIEF> also climbed 1.5 percent.
The dollar fell 0.7 percent against the yen to 98.26 yen
<JPY=> while the euro was little changed at $1.3329 <EUR=>.
Concern about U.S. banks and uncertainty about a European
Central Bank policy meeting did dull some risk appetite and
boost safe haven flows into the greenback.
New York gold futures rose for a third straight day on
Wednesday as the stress tests on U.S. banks underscored
lingering economic uncertainties, bolstering safe-haven demand
in the bullion market. [].
Gold for June delivery <GCM9> was up $7.50 at $911.80 on
the COMEX division of the New York Mercantile Exchange.
(Reporting by Reuters bureaux worldwide, writing by Nick
Olivari in New York, Editing by Chizu Nomiyama)
