While you were sleeping: UPDATED Oil report lifts US stocks

Wall Street took its cue from rising oil prices, which overshadowed a downgraded outlook for Alcoa.

US crude rose 4.5% to $US42.27 a barrel for May delivery after the Interfax news agency reported Saudi Arabia and Russia reached a consensus on an output freeze, citing an unidentified "informed diplomatic source" in Doha, and that Saudi Arabia will make a final decision regardless of Iran's position.

Shares of Alcoa fell, 2.7% amid concern about the metals company's outlook for its largest manufacturing unit. Alcoa is set to split in two in the second half of this year, with its traditional smelting and refining unit maintaining the Alcoa name, while its manufacturing business will trade under the name Arconic.

"There will be some disappointment" on the outlook for engineered products, Anthony Young, an analyst at Macquarie Group, told Bloomberg.

"This is the cornerstone of Arconic and if that business isn't as good as they previously thought, it may negatively impact the longer-term valuation."

On Wall Street, the Dow Jones Industrial Average climbed 164.84, or 0.9%, to 17,721.25 while the Nasdaq Composite Index advanced 0.8% to 4872.09. The Standard & Poor's 500 Index rose 1.0% to 2061.72.

The Dow's rise led by gains in shares of Chevron and those of Caterpillar, up 2.4% and 2.1% respectively.

Not as bad as feared
The start of a US earnings season that's expected to be dismal is helping equities.

"The market has been expecting earnings to be absolutely terrible and they are but they're not quite as terrible as everyone thought and things are looking better ahead," Brad McMillan, chief investment officer for Commonwealth Financial in Waltham, Massachusetts, told Reuters.

"When you combine not-as-bad today with the promise of a better tomorrow, that says that perhaps there's more upside and the market is starting to react to that," he noted.

Even so, shares of Juniper Networks dropped, last 7.3% lower, after the company forecast lower-than-expected quarterly profit and revenue.

In Europe, the Stoxx 600 Index ended the day with a 0.5% increase from the previous close. Mining stocks rose, with shares of Anglo American soaring 9.2%.

The UK's FTSE 100 Index rose 0.7%, while France's CAC 40 Index rose 0.8%, as did Germany's DAX Index.

(BusinessDesk)