Global stocks jumped on Wednesday morning as investors looked beyond dismal European news and focused on comments from China's central bank governor that China remains prepared to help the euro zone with its debt problems.
U.S. index futures were higher with about two hours before markets open, suggesting that stocks will rise at the start of trading. Futures for the Dow Jones industrial average rose 80 points or 0.6 per cent. Futures for the broader S&P 500 rose 9 points or 0.7 per cent.
Both indexes ended Tuesday relatively flat after making a striking comeback in the final half-hour of trading, in a rebound that was driven by the view that Greek policy makers were providing the guarantees on austerity measures that euro zone members were demanding.
On Wednesday, it was hard to see the source of a rally in Europe: There is some talk that some euro zone members now would prefer to see Greece default on its debt obligations rather than be supported by bailouts. The OECD warned that German economic growth is threatened by the crisis, predicting that its economy will expand by just 0.5 per cent in 2012.
Meanwhile, European gross domestic product contracted by 0.3 per cent in the fourth quarter. While that contraction is better than expected, it nonetheless points to recession.
The big hopes appear to be coming from China, where investors believe comments from the country's central bank suggest that it is willing to use its financial heft to lift Europe from its sovereign-debt woes. The U.K.'s FTSE 100 was up 0.2 per cent and Germany's DAX index was up 1.4 per cent in afternoon trading.
In Asia, Japan's Nikkei 225 jumped 2.3 per cent, rising on the latest asset-buying efforts from the Bank of Japan.
Commodities were also on the rise. Crude oil rose to $101.50 (U.S.) a barrel, up 0.8 per cent. Gold rose to $1,728 an ounce, up 0.6 per cent.
Canadian energy stocks will be in focus after a couple of high-profile companies reported their quarterly results. Talisman Energy Inc. in its fourth quarter reported a loss of $117-million or 11 cents a share. Cenovus Energy Inc. reported that its earnings rose to $266-million or 35 cents a share, up from 10 cents a share last year.
In economic news, the U.S. Empire Manufacturing report for February will be released at 8:30 am (ET), followed by January's report on industrial production. The biggest release, though, is the minutes from the previous Federal Reserve monetary policy meeting, due out at 2 pm.