Equity markets worldwide higher, ECB stimulus hints

NEW YORK: Equity markets worldwide pushed higher on Monday after rising expectations for more European stimulus supported shares in the region, while year-end buying helped push the S&P 500 and the Dow industrials to a record close.

U.S. stocks rose for a fourth straight session on gains in large-cap technology shares. Anticipation of outright government bond buying from the European Central Bank and greater political stability in Greece boosted European bourses.

"You’ve got the normal seasonality of the market supported by strong fundamentals," Philip Orlando, chief equity market strategist at Federated in New York, said of the gains in U.S. stocks.

The dollar edged higher against a basket of major currencies, reversing an early dip in thin pre-holiday trading.

Trading volume is expected to be light this week due to the Christmas holiday, which could increase volatility. U.S. equity markets will open for an abbreviated session on Wednesday and close on Thursday for Christmas.

In the euro zone, Belgium's Luc Coene became the latest ECB policymaker to back outright government bond buying to stimulate the region's economy, while declines in oil prices ramped up expectations that the ECB could announce more stimulus measures to fight deflation.

"Even the Germans would have to wince and accept a certain degree of quantitative easing given the deflationary expectations associated with lower oil prices," said Clem Miller, portfolio manager at Wilmington Trust Investment Advisors in Wilmington, Delaware.

Expectations grew that Greece could avoid destabilizing snap elections after Prime Minister Antonis Samaras made a surprise offer to bring pro-European independents into the government if they backed his choice for a new president. The move boosted Greek shares.

MSCI's all-country world index <.MIWD00000PUS> was last up 0.47 percent at 420.15. Europe's broad FTSEurofirst 300 index <.FTEU3> closed up 0.44 percent, at 1,367.

The Dow Jones industrial average <.DJI> closed up 0.87 percent at 17,959.44. The S&P 500 <.SPX> rose 0.38 percent to close at 2,078.54, and the Nasdaq Composite <.IXIC> ended up 0.34 percent at 4,781.42.

A 14 percent plunge in shares of Gilead Sciences was the biggest drag on both the S&P and Nasdaq 100 <.NDX> indexes.

Yields on benchmark 10-year U.S. Treasury notes were down slightly from Friday's levels at 2.16 percent after the government's sale of $27 billion new two-year notes, the first offer of $104 billion in new supply this week.

The U.S. dollar index <.DXY>, which measures the greenback against a basket of six major currencies, was last up 0.18 percent at 89.760.

Brent crude settled down $1.27, or 2.07 percent, at $60.11 a barrel. U.S. crude settled down $1.87, or 3.27 percent, at $55.26 per barrel.

Spot gold prices fell $23.83, or 1.99 percent, to $1,171.52 an ounce on the dip in oil prices.- Reuetrs