WTI Crude oil futures bounced back sharply today, eying the massive spate of gains in world stocks and as a break above $80 per barrel helped build up strong momentum for the commodity after the prices tested nine month lows yesterday. Asian equities jumped sharply, tracking a smart surge in the overnight US markets as the investors eyed the possibility that the US Fed could launch another round of quantitative easing. The US central bank, announced yesterday that it would keep the key interest rate in its current ultra-low range - between zero and one-quarter of a percent -- until at least the middle of 2013. DDOW went up in response to this, shaking off the diabolic losses of 600 points earlier in the week. Investors parried the global demand worries as soon as the Fed announcement came in and instead eyed the continued flow of cheap money, which has supported the markets well over last few quarters. Commodities surged and DOW rallied more than 400 points, ignoring the weak economic data. The index closed with gains of nearly 4% on the day. The US Fed meeting followed several days of steep losses for stock markets around the world, and Friday's downgrade of US credit by the Standard & Poor's rating agency. Central bank officials said they discussed other policy options to boost the economy, and are ready to use them if needed. The Fed also indicated that it discussed the range of policy tools available to promote a strong economic outlook recovery in a context of price stability and stated that it's prepared to employ the tools as appropriate. The Reserve noted that it is worried that the nation's economy is recovering more slowly and the labor market is weaker than expected. In other economic news today, the UK manufacturing output fell unexpectedly in June, raising further doubts about the government's hard line insistence on fast and deep public spending cuts. Economists had been anticipating a 0.2% increase but instead were surprised to learn that manufacturing output took a step back in June, declining by 0.4%, having risen 1.8% in May. A 1.7% fall in car production was the most noticeable feature of the figures released by the Office for National Statistics, while the chemicals, paper and publishing sectors also contracted. WTI Crude oil futures broke above $80 per barrel and currently quote at $82.29, up $2.99 per barrel on the day. MCX Crude oil futures jumped above Rs. 3700 and stabilized after the losses in last few sessions. The commodity currently quotes at Rs. 3724, up Rs. 61 per barrel on the day or 1.67%.

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