GLOBAL MARKETS-Euro rises, stocks jump on EU crisis plan

                                
 * EU agrees 500 bln euro emergency fund to fend off debt
woes
                                
 * Euro rises 0.6 percent but off early highs
                                
 * Stocks up 1.7 pct on hopes plan will restore confidence
                                
 * Major central banks also liquidity support to ease
strains
                                
 By Umesh Desai
                                
 HONG KONG/SYDNEY, May 10 (Reuters) - The euro firmed and
stocks rose on Monday after the European Union agreed on a 500
billion euro ($670 billion) emergency fund as it struggles to
keep Greece's debt problems from spreading to other countries.
                                
 Major global central banks moved swiftly to support Europe,
re-establishing dollar swap facilities used during the
2007-2008 financial crisis to help ease strains on financial
markets and ensure there was enough liquidity to keep global
credit markets from seizing up.
                                
 The euro <EUR> rose as high as $1.2950 on news of the deal
before slipping back after the European Central Bank said it
would buy euro zone government and private debt, abandoning
resistance to full-scale bond purchases in light of Greece's
debt crisis. [ID:nN09270819]
                                
 By midmorning, the single currency was up 0.6 percent on
the day at $1.2828 <EUR=>, and was 1.5 percent higher against
the yen at 118.55 yen <EURJPY=R>. [ID:nTKW006917]
                                
 The EU plan was a mix of loans and loan guarantees, an EU
diplomat said.
                                
 Goldman Sachs said in a report before the plan was formally
announced that the package was impressive if confirmed.
                                
 Financial markets have been punishing heavily indebted euro
zone members, threatening to plunge them into the same sort of
crisis as Greece and possibly jeopardising the global economic
recovery.
                                
 The new safety net was meant to protect other countries
with bloated budgets, such as Portugal, Spain and Ireland.
                                
 Jitters over euro zone finances have battered global
markets as investors dump riskier assets for safer ones such as
the U.S. dollar, creating fears of dollar shortages in some
countries and driving up dollar funding costs.
                                
 * The euro <EUR=> climbed as far as $1.2950 before paring
gains but remained well off 14-month lows of $1.2520 hit last
week as fears of a euro zone sovereign debt crisis escalated.
                                
 * The MSCI world stock index <.MIWD00000PUS> rose 0.6
percent, with the MSCI Asia ex-Japan index <.MIAPJ0000PUS> up
1.7 percent.
                                
 * Japan's stock market opened higher with the Nikkei
benchmark <.N225> up 1.3 percent. The June S&P futures contract
<SPc1> was up 2.3 percent.
                                
 * Before the European announcement, data from the Commodity
Futures Trading Commission showed euro sceptics were not easily
won over, with  bets against the common currency hitting a
record high in the week ending May 4. [IMM/FX]
                                
 * Oil <CLc1> was up 1.74 percent at $76.42, off a
near-three-month low struck Friday.
                                
 * Gold <XAU=> was softer at $1,198.20, pulling back from a
near record-high of $1,213.35 hit Friday.
                                
 * The U.S. dollar was firmer against the yen at 92.24
<JPY=> and well off Friday's five-month lows of 88.00.
                                
 * U.S. Treasuries <0#USBMK=> were broadly weaker amid
optimism about the plan adding to Friday's losses after the
U.S. Labor Dept reported larger-than-expected employment gains
in April, suggesting the economic recovery was well underway.
 (Additional reporting by Koh Gui Qing; Editing by Kim
Coghill)