Financial stocks lead Wall Street higher

Stocks on Wall Street rose modestly as capital-raising plans by several European banks signalled the region’s financial system would experience the same return to health as in the US.

On the downside, Monsanto's earnings were below expectations despite a 15% jump in profitability. The agribusiness company’s shares fell 4.8%.

The Dow Jones Industrial Average rose 32.85 points, or 0.3%, to 12,426.75 at the close (NZT). Earlier, the measure hit an intraday high of 12,450.93, a level not seen since June 2008.

Leading the Dow's advance, Cisco Systems jumped 4.4% after indicating the company would undergo major changes. The Dow's other technology components also rose, with Hewlett-Packard up 2.4% and Microsoft up 1.2%.

Financial components were also strong, with American Express up 2.2%, JP Morgan Chase up 1.1% and Bank of America up 0.6%. This followed a rally in European financial stocks after several banks – including Commerzbank,Intesa Sanpaolo and Deutsche Bank – announced plans to raise fresh capital.

The Nasdaq Composite finished 0.3% higher at 2799.82 and the S&P 500 index was 0.2% to 1335.54.

Other markets: Europe up, Asia mixed
European stocks rallied on bank capital-raising plans and better-than-expected German industrial data.

The euro rallied ahead of today’s expected rate increase by the European Central Bank.

The Stoxx Europe 600 index rose 0.2% to 281.57. The UK's FTSE 100 index climbed 0.6% to 6041.13, France's CAC-40 index advanced 0.2% to 4048.16 and Germany's DAX added 0.6% to 7215.11.

Asian stock markets were mixed, as investors took a rate move from China's central bank in stride, while gold plays around the region gained as the metal's price touched a record.

Japan's Nikkei Stock Average ended down 0.3% at 9,584.37, Korea's Kospi Composite fell 0.2% to 2,126.71 and India's Sensex fell 0.4% to 19612.2.

Australia's S&P/ASX 200 rose 0.3% to 4912.91, Hong Kong's Hang Seng Index added 0.6% to 24,285.05 and China's Shanghai Composite advanced 1.1% to 3001.36.

Commodities: Gold up, oil steady
Gold futures in New York remained near record highs as investors continued to fret about global inflationary pressures from rising oil prices.

The most actively traded gold contract, for June delivery, was up $US7.50, or 0.5%, at $US1460 an ounce after hitting an intraday record of $US1462.30.

Oil futures gave back gains after a government report showed US oil stockpiles rose for the fifth straight week.

Light, sweet crude for May delivery rose 10USc, or 0.1%, to $US108.44 a barrel in New York. Brent crude on the ICE futures exchange fell 17USc, or 0.1%, to $US122.05 a barrel.

Currencies: Euro rises ahead of predicted rate rise
The euro held on to strong gains against its rivals even as Portugal's finance minister said the country would need to request a financial lifeline from the European Union.

But traders were focused on the expected European Central Bank increase in key rates. The euro was up about 0.8% on the day against the US dollar and 1.2% against the yen.

The euro earlier hit its strongest level in 14 months against the dollar. It traded at $US1.4330 from $US1.4221 late on Tuesday.

Meanwhile, the dollar was at ¥85.37 from ¥84.83. The pound was trading at $US1.6330, compared with $US1.6278. The dollar bought 0.9189 Swiss franc from 0.9252.