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New York - US stocks jumped more than 1.0% on opening as weekly jobless claims dropped to their lowest in more than 2-1/2 years on Thursday, while the euro rallied against the US dollar after the ECB president warned about inflation risks.
Oil prices dipped, also bolstering world stocks, after a proposal by Venezuela President Hugo Chavez to try to broker a peace deal in Libya. World stocks as measured by MSCI were up 1.0% and on Wall Street the Dow Jones industrial average was up 150 points shortly after the open.
The euro soared after European Central Bank President Jean-Claude Trichet said inflationary risks are to the upside and "strong vigilance" is required. The word "vigilance" in previous tightening cycles usually suggested a near-term rate hike.
Oil jumped to approach 2-1/2-year highs on Wednesday as violence escalated in oil producer Libya. Brent crude oil was down $1.74 at $114.61 a barrel. Investors worry that political instability could spread to major oil producer Saudi Arabia, a central US ally in the region, and other oil suppliers.
In the US stock market, the Dow Jones industrial average was up 150.00 points, or 1.24%, at 12 216.80. The Standard & Poor's 500 Index was up 15.52 points, or 1.19%, at 1 323.96. The Nasdaq Composite Index was up 33.95 points, or 1.24%, at 2 782.02.
As stocks rose, US bonds fell. The benchmark 10-year note was down 16/32, its yield rising to 3.53% from 3.47% on Wednesday, after the jobless data.
The euro pierced resistance around $1.3958, its 200-week moving average, to hit as high as $1.3976 , its strongest since November 8 and on track to test the psychologically important $1.40 level.
