China data boosts world stocks, euro climbs

The company's London shares were down 6.1% to 367.7 pence, hitting their lowest level since 1997 as they caught up to the losses in the United States that occurred after the UK markets closed on Wednesday.

Several analysts said the sell-off in BP was not justified because the company still has ample cash reserves to cover the clean-up costs of the spill but that political pressure had created uncertainty in the markets.

"It's tough to make price predictions on the stock, but I think the downside risks are outweighed by the near-term upside potential," said Mike Breard, analyst with Hodges Capital Management in Dallas.

Firming Euro

The euro, drubbed in recent days on concern that investors may balk at funding debt-laden European nations, rose after signs of strong demand at a Spanish bond auction. The currency hit its high for the day as the European Central Bank said its government bond purchase program should not be viewed as a change to monetary policy.

The euro rose 0.96% at USD1.21 from a previous session close of USD 1.1985.

The dollar declined against a basket of major trading-partner currencies, with the US Dollar Index falling 0.82% to 87.177. The dollar rose 0.05% to 91.31 yen.

Europe's common currency got an earlier boost after Dai Xianglong, chairman of $114 billion China's National Social Security Fund, said the euro would gradually stabilize and that the U.S. fiscal deficit remained a big concern, tempering safe-haven demand for the dollar.

There have been some concerns in currency markets that the debt crisis would persuade central banks, including China's, to cut back on their euro reserves.

US Treasuries fell as signs of improvement in weekly U.S. jobless insurance claims added fuel to a sell-off ahead of a 30-year bond auction. Benchmark 10-year note yields rose to 3.26%.

In energy and commodities, U.S. light sweet crude oil rose USD 1.47, or 1.98%, to USD 75.85 per barrel, and spot gold fell USD 11.65, or 0.95%, to USD 1,218.70 an ounce.