* EM, European shares rise to put world index near one-year
* AUD climbs on RBA decision to hold rate at record-low 1.5
* Nikkei closes up 0.3 percent as dollar strengthens
* Oil prices in tighter range after $3 move
* Oil gains on Russian, Saudi agreement to stabilize market
By Marc Jones
LONDON, Sept 6 World shares closed in on
one-year highs on Tuesday as the prospect of prolonged cheap
borrowing costs and a recent rise in oil prices set off a new
emerging market bull run.
Asian stocks reached one-year highs overnight and MSCI's
46-country 'All World' index was close to the
same as most of Europe's markets climbed 0.1 to 0.3 percent
Wall Street was also looking set for modest gains when it
reopens later after a long Labour Day weekend and with a batch
of manufacturing data due.
Britain's FTSE 100 was Europe's laggard, spending a
second day in the red, as sterling's slow recovery after
the country voted to leave the European Union left investors
looking at companies' competitiveness again.
Emerging markets had no such worries. A gain of nearly 1
percent for the main emerging market stock index took
its rise over the last three trading days past 3 percent and put
it up more than a third since January.
The latest advance came as the prospect of a U.S. interest
rate rise was pushed back by weak jobs data on Friday. Rising
oil prices helped oil-rich emerging markets such as Mexico,
Brazil and Russia.
(EM stocks performance in 2016 link.reuters.com/weh36s)
"Emerging markets have continued to rally, supported by a
rise in commodity prices and continued expectations that the Fed
will remain dovish," said Standard Life Investment's Alex Wolf.
"In addition, there are some fundamental improvements --
August sales improved across many companies and PMI data showed
stabilization in China."
Oil markets were calmer, after prices surged, then slid on
Monday, when Russia and Saudi Arabia confirmed they had agreed
to cooperate to stabilise the oil market, although they offered
no immediate plan of action.
U.S. crude was up 50 cents at $45 a barrel. Brent
crude was down at $47.32, having swung wildly from
$46.40 to $49.40 in the previous session.
The U.S. dollar barely budged against the yen, at 103.67 yen
, but fell for a fifth day against the pound and
eased to 1.1166 per euro.
Australia's dollar jumped almost 1 percent to
$0.7655 after the country's central bank said little on the
currency's 10 percent rise since January and kept Aussie
interest rates at 1.5 percent.
"One perhaps could have expected some more discussion of the
currency, but we probably need to get back above 0.80 for verbal
invention to come back into favour," said Tobias Davis, head of
corporate treasury sales with Western Union in London.
Australian shares slipped 0.4 percent after the
RBA's decision, but MSCI's index of Asia-Pacific shares outside
Japan extended its recent gains as hard-rallying
markets like India helped it set a new one-year high.
Japan's Nikkei stock index closed up 0.3 percent as
the yen gave up some ground made on Monday, when Bank
of Japan Governor Haruhiko Kuroda shied away from detailed talk
of fresh BOJ stimulus.
European bonds were also buoyant. Spanish government bond
yields slipped below 1 percent, continuing a strong performance
that defies growing political uncertainty in Spain.
German Bund yields sagged to minus 0.059 percent as focus
turned to the European Central Bank's post-summer meeting on
Thursday. Ten-year U.S. Treasuries hovered at 1.6 percent.
There were plenty of statistics for U.S. stocks traders to
digest as they readied for ISM data later. Wall Street's rally
is now the second longest in history and three-quarters of the
firms on the S&P 500 are above their 200-day 'moving'
For some investors that is another reason to be looking at
"We have a development where the market is waiting for Fed
not to do anything and in that period we get values compressed,"
said SEB investment management's head of asset allocation, Hans
"U.S. valuations reach max levels and the rest of the world
eventually converges. So it is a convergence theme we see."
For Reuters new Live Markets blog on European and UK stock
markets see reuters://realtime/verb=Open/url=http://emea1.apps.cp.extranet.thomsonreuters.biz/cms/?pageId=livemarkets
(Additional reporting by Patrick Graham; Editing by Catherine