markets

Shares on Wall Street rose along with oil prices on last night as acquisition news and hopes of progress in Europe’s debt crisis prompted investors to buy up assets cheapened by last week’s rout.

News that Google offered to buy Motorola Mobility Holdings for about $12.5 billion in cash fuelled a rebound in US stocks for a third straight session.

Global equities climbed further out of their August hole on news that Japan’s economy shrank less than anticipated in the second quarter as companies made strides in restoring output following the devastating earthquake and tsunami.

“The Japanese news, while not overly encouraging, was another data point showing things are not nearly as bad as the sell-off seemed to suggest,” said Rick Mecklerof investment firm LibertyView Capital Management in New York. “This is an extremely jittery market, just looking to avoid significant bad news,” he said. “I would expect there to be less volatility than we saw last week.”

The dollar’s drop to a three-week low against the euro, at $1.44779, lent support to commodities while London Brent crude oil futures for September rose 93 cents to $108.96.

The euro rose on expectations of a positive outcome of today’s meeting between French president Nicolas Sarkozy and German chancellor Angela Merkel to discuss Europe’s debt crisis.

The Dow Jones industrial average shot up 213.88 points, or 1.90 per cent, to end the day at 11,482.90 while the broader Standard & Poor’s 500 Index gained 25.68 points, or 2.18 per cent, to finish at 1,204.49. The Nasdaq Composite Index climbed 47.22 points, or 1.88 per cent, to close at 2,555.20.