Dow soars over 200 points as US joins rally

US indices have opened almost 2% higher on the first trading day of 2012 as risk appetite resumes across global markets.

The S&P 500 has opened 1.8% higher at 1,280 points, with the Dow Jones Industrial Average up 1.9%, or 230 points, to 12,447.

The jump follows gains made in the UK, Europe and Asia.

The strong opening in the US helped push the FTSE back up to 5,663 points, a rise of 1.6%, with resources groups Kazakhmys, Essar Energy and BHP Billiton, leading the way after putting on more than 6% each.

Meanwhile lower-than-expected unemployment figures in Germany have helped the Dax rise 1.4% to 6,161, though France's Cac 40 is down 0.2% to 3,214 following strong gains on Monday. The euro rose 0.7% against the dollar to $1.302.

Elsewhere, fears of a confrontation between Iran and the US following military exercises in the Gulf by the former have pushed the price of US crude oil back above the $100 a barrel mark.

WTI crude was trading at $101.11 per barrel shortly before the US open, with Brent crude up 2.5% at $110.35 a barrel.