Bank shares push Wall Street higher

Soaring bank shares have led Wall Street higher as Bank of America raised hopes that it will increase dividends and share buybacks, while crude-oil prices dropped in response to reports Muammar Gaddafi may be looking for a peaceful end to the Libya crisis.

At the close (10am NZ time), the Dow Jones Industrial Average was up 124.35 points, or 1.0%, to 12,214.38, while the S&P 500 index added 0.9% to 1321.82 and the Nasdaq Composite has also gained 0.9% to 2765.77.

Leading the gains were financial stocks, including Dow components Bank of America, up 4.3%; American Express, up 3.5%; and JP Morgan Chase, up 3.1%. Citigroup added 2.8%, Wells Fargo gained 3.2% and Goldman Sachs increased 1.4%.

Other markets: Europe, Asia up
European stocks ended a choppy session slightly higher, supported by strength in the telecommunications sector and lower oil prices.

The Stoxx Europe 600 index closed up 0.4% at 281.81, while France's CAC-40 index ended up 0.4% at 4015.91. The UK’s FTSE 100 and Germany's DAX both finished nearly flat, however, at 5974.76 and 7164.75 respectively.

Asian stocks rose, as big mergers bolstered Tokyo shares and a mild pullback in crude oil helped ease investor concerns about the economic impact of high oil prices.

Japan's Nikkei Stock Average added 0.2% to 10525.19. Australia's S&P/ASX 200 rose 0.2% to 4808.25.

Korea's Kospi Composite tacked on 0.8% to 1996.32, Hong Kong's Hang Seng index leapt 1.7% to 23711.70 and the Shanghai Composite rose 0.1% to 2999.94.

Commodities: Oil down, gold steady
Crude oil futures retreated as investors sought to lock in profits following reports that the Libyan leader's exit is being debated by his close alllies.

The prospect of Western military intervention, such as a no-fly zone, and the opening of US strategic oil reserves also weighed on prices.

Light, sweet crude for April delivery fell 51USc, or 0.5%, at $US104.93 a barrel in New York. Brent crude on the ICE futures exchange gave up $US1.79, to 1.6%, at $US113.25 a barrel.

Gold held near steady as traders eyed tensions in the Middle East and crude-oil prices.

The most actively traded gold contract, for April delivery, was down 0.7%, or $US10.60, at $US1423.90 an ounce in New York.

Currencies: Dollar in demand
The US dollar rose as falling oil prices boosted demand. Speculation about the US Federal Reserve's bias toward ultra-loose monetary policy also jolted markets.

Traders noted a report that raised the possibility of the Fed altering its stance on quantitative easing as the economy shows signs of strength.

The euro rebounded from session lows against the dollar around $US1.3862, changing hands at $US1.3907 from $US1.3977 late on Monday. The euro was more than a cent below a four-month high it hit on Monday around $US1.4036.

The dollar bought ¥82.70 from ¥82.26. The dollar fetched 0.9350 Swiss franc from 0.9262 franc.