World stocks, crude oil rise on Ukraine ceasefire hopes

Russian shares surge more than 4%, rouble jumps 1.5% against the dollar

World markets jumped on Wednesday as Ukraine's President Petro Poroshenko said a ceasefire had been reached with Russia, raising hopes that a recent escalation in the conflict could be reversed.

The news sent Russian shares soaring towards their biggest daily gains in four months, while the rouble jumped 1.5 per cent against the dollar, despite some differing reports of the extent of the truce talks from the Kremlin.

Poroshenko's press office said Ukraine's president reached agreement with his Russian counterpart Vladimir Putin on Wednesday on a "permanent ceasefire" in eastern Ukraine's Donbass region.

The Kremlin later said steps towards peace had been discussed but there was no formal ceasefire because Russia is not a party to the conflict between Kiev and pro-Russian rebels in Ukraine's eastern Donbass region.

Dollar-traded Russian stocks rose over four percent, while the pan-European FTSEurofirst 300 was up 0.9 per cent at 1,388.11 points. While the rouble was the main mover, the euro was also higher on the day against almost every other major currency.

Wall Street futures also rose 0.5 per cent, pointing to a solid start for US markets, while MSCI's broadest index of Asia-Pacific shares outside Japan, already buoyant after strong Chinese services data extended gains, added one per cent.

German 10-year bond yields — the euro zone benchmark — pulled off a day's high of 0.969 percent but were still up 3 basis points on the day.

Cautious approach
Many analysts still remain sceptical about any near-term resolution to the Ukraine conflict which has killed more than 2,600 people since April and provoked the worst crisis in relations between Russia and the West since the Cold War.  Earlier in Asia, Japan's Nikkei stock average ended up 0.4 per cent near a seven-month high, bolstered by hopes that Prime Minister Shinzo Abe's cabinet reshuffle will give fresh momentum to his growth-oriented policies.

Brent surges to $101
Brent crude gained from the lowest close in more than 16 months as Russia and Ukraine took steps toward a cease-fire that may signal revived regional trade. West Texas Intermediate rose from the lowest since January.

Futures rebounded as much as 1.2 per cent in London.  Brent for October settlement gained as much as $1.24 cents to $101.58 a barrel, and traded at $101.30 at 11:56 am on the London-based ICE Futures Europe exchange.