ADP Automatic Data Processing Inc

Stocks around the world extended gains Wednesday as a recent rebound in commodities prices and signs of improvement in the U.S. economy helped calm fears of a global slowdown.

European stocks rose and Asian shares surged following a strong finish on Wall Street.

The Stoxx Europe 600 was up 0.6% in early trade, on course for its fifth consecutive session of gains.

The Dow Jones Industrial Average and S&P 500 both saw their largest one-day gains since January on Tuesday after measures of the U.S. manufacturing sector, auto sales and construction spending all rose.

"The stock market priced in a [U.S.] recession, and we're nowhere near a recession," said Kully Samra, U.K. managing director at Charles Schwab. "The U.S. economy is predicated on the consumer, and the consumer is in rude health," he said.

In Asia, Japan's Nikkei Stock Average climbed 4.1%, while Hong Kong's Hang Seng Index gained 3% and the Shanghai Composite Index rose 4.3%. Australia's S&P ASX 200 closed up 2% after data showed that Australia's economy expanded more strongly than expected.

Rising oil and base metals prices have lent support to the recent stock market rally following steep drops earlier this year. Brent crude oil was last down 0.8% at $36.52 but is still up nearly 12% from a month ago. Oil markets rose to a two-month high in the previous session on hopes for an output agreement among large producers.

Copper and iron ore prices have rebounded, supported by the strong U.S. data and hopes for more stimulus from China. The three-month copper futures contract on the London Metal Exchange was up 1.1% at $4,784 a ton, boosting Europe's basic resources sector.

European equities also saw support from closer to home. European Central Bank President Mario Draghi said the bank will review its stimulus next week against a background of heightened economic risks and weaker-than-expected inflation.

His comments came ahead of a key ECB policy meeting on March 9 and 10, where the bank has pledged to "review and possibly reconsider" its roughly €1.5 trillion (roughly $1.6 trillion) stimulus.

In currencies, the dollar extended some of its gains against the euro and yen following the upbeat U.S. data, but moves were tempered as some investors booked profits. The dollar was up 0.3% against the yen at ¥ 114.2140, while the euro was down 0.1% against the dollar at $1.0862.

Currency investors will take direction later Wednesday from U.S. data with the release of the ADP national employment report ahead of February nonfarm payrolls due Friday.

Tom Fairless contributed to this article.

Write to Riva Gold at riva.gold@wsj.com

(END) Dow Jones Newswires

March 02, 2016 04:25 ET (09:25 GMT)

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