Global stocks rise, U.S. data defies slowdown fears

By Herbert Lash

NEW YORK (Reuters) - Global equity markets advanced and the dollar rose to its highest level since 2009 on Wednesday as momentum grew for the European Central Bank to launch a bond-buying program and data showed U.S. economic resiliency in the face of slowing world growth.

U.S. Treasuries prices steadied after two days of losses as bond traders awaited a possible ECB shift in monetary policy on Thursday and a key report on American unemployment on Friday.

Most euro zone bond yields headed toward record lows. The ECB is under pressure to do more to boost growth and fend off deflation, as oil prices have slumped and data showed business activity in the bloc grew less than expected in November.

The euro skidded to a 27-month trough against the dollar, which also hit a seven-year peak against the yen. The greenback got a boost as Federal Reserve officials made upbeat comments about the U.S. economy, feeding expectations for a U.S. interest rate hike in mid-2015.

"Investors are looking to increase their holdings of the dollar and decrease the euro because they're anticipating further lower price action on the euro on the basis of ... further easing and stimulus from the ECB," said Neil Jones, head of hedge fund FX sales at Mizuho Bank in London.

The dollar rose to its highest level since March 2009 against a basket of major currencies at 89.005.

The euro fell as low as $1.2303, its weakest since August 2012, and it last traded near $1.2313, down 0.4 percent on the day.

Against the yen, the dollar rose 0.37 percent to 119.63.

European stocks rose, led by shares in Greece, Italy and Spain, as investors bet the ECB would signal further economic stimulus. U.S. stocks edged higher, led by commodity-related shares, as data continued to show a strengthening U.S. economy.

Markets reacted mutedly to data showing the U.S. private sector created 208,000 jobs last month, fewer than expected. The numbers, however, suggested a slowing global economy is having a limited impact on domestic activity.

MSCI's all-country world stock index rose 0.06 percent, while the FTSEurofirst 300 index of top European shares was up 0.51 percent at 1,399.60 points.

The Dow Jones industrial average rose 6.71 points, or 0.04 percent, to 17,886.26. The S&P 500 gained 4.04 points, or 0.2 percent, to 2,070.59 and the Nasdaq Composite added 8.74 points, or 0.18 percent, to 4,764.55.

The benchmark 10-year Treasury was last off 4/32 in price to yield 2.2994 percent.

Brent oil rose to $71 a barrel in choppy trading as the market searched for a price floor after a near 40 percent fall since June, and as U.S. crude stocks declined last week.

Brent for delivery in January was up 22 cents at $70.76 a barrel after falling by $2 on Tuesday on a deal between Baghdad and its Kurdish region over oil sales.

U.S. crude for January delivery rose 74 cents to $67.62 a barrel.

(Additional reporting by Blaise Robinson, Jemima Kelly, Emelia Sithole-Matarise and Chris Vellacott; Editing by Susan Fenton and David Gregorio)