* Stocks rally after U.S. housing, durables data
* Dollar falls broadly, Ifo data helps lift euro
* Oil rises to $76 on quantitative easing expectations
* Bonds fall on news of strong U.S. business spending
(Updates with close of European markets)
By Herbert Lash
NEW YORK, Sept 24 (Reuters) - Global stocks rallied and the
dollar slid on Friday as U.S. and German data lifted spirits
while a housing report bolstered speculation the Federal
Reserve will boost money supply to aid the struggling economy.
U.S. oil futures prices climbed above $76 a barrel, buoyed
by growing expectations that the Fed will pump another round of
billions of dollars into the economy to encourage growth. For
details see: []
While the economic reports on U.S. durable goods orders and
home sales were mixed, traders latched on to a rise in business
spending in August as the latest sign the recovery is on firmer
ground. []
Wall Street gained almost 2 percent, putting U.S. stocks on
course for four weeks of gains, while European equity indexes
closed up about 1 percent. Emerging markets lagged, advancing
0.7 percent, according to an MSCI index. <.MSCIEF>
U.S. Treasury debt and Bund futures fell in volatile
trading as the U.S. data supported a shift out of government
bonds and into riskier assets.
And the dollar tumbled against a basket of currencies
<.DXY> to a low last seen in May on a stronger-than-expected
rise in the German Ifo business climate index for September to
its highest level in more than three years. []
The euro <EUR=> was up 1.24 percent at $1.3475.
The Dow Jones industrial average <> was up 178.91
points, or 1.68 percent, at 10,841.33. The Standard & Poor's
500 Index <.SPX> was up 21.35 points, or 1.90 percent, at
1,146.18. The Nasdaq Composite Index <> was up 44.70
points, or 1.92 percent, at 2,371.78.
The U.S. data reinforced the view that the Fed may provide
more monetary support to help the economy.
[][]
"Overall, both durables and housing numbers suggest the
economy is still weak and that the Federal Reserve is still on
track for a second round of quantitative easing," said Nick
Bennenbroek, head of FX strategy at Wells Fargo in New York.
Gold rallied to record highs in Europe, with spot prices
knocking on the door of $1,300 an ounce on expectations of
further quantitative easing in the United States.
Spot gold <XAU=> hit an all-time high of $1,299.95 an
ounce, and later eased to $1,295.25.
"The U.S. Fed is obviously contemplating, and the market is
expecting, some kind of statement on quantitative easing," said
Deutsche Bank analyst Daniel Brebner. "The influx of new money
in the system raises longer-term expectations for inflationary
forces."
News of revived business spending drew investors away from
safe-haven government debt after a week-long bond rally. U.S.
traders cited talk of a very large asset allocation trade from
bonds to equities. []
The benchmark 10-year U.S. Treasury note <US10YT=RR> was
down 12/32 in price to yield 2.59 percent.
Bund futures <FGBLc1> fell by over half a point, settling
54 ticks lower at 130.85.
"It's risk-on again after a decent set of durable goods
numbers. Despite the fact the headline number was weaker,
supporting data were fairly strong," said Philip Shaw, chief
economist at Investec in London.
European stocks reversed losses and staged a late rally,
with Spain's tougher-than-expected 2011 budget helping lift the
mood as investors were reassured of the country's willingness
to tackle its debt.
The FTSEurofirst 300 <> index of top European shares
closed 1.2 percent higher at 1,078.15 points.
Crude oil advanced. U.S. light sweet crude oil <CLc1> rose
$1.18, or 1.6 percent, to $76.36 a barrel.
Japan's Nikkei share average <> dropped 1 percent to
end at 9,471.67 after initially climbing on the yen
intervention talk. The MSCI index for Asia ex-Japan stocks
<.MIAPJ0000PUS> was up 0.5 percent.
(Reporting by Edward Krudy, Vivianne Rodrigues, Ellen Freilich
in New York; Kirsten Donovan and David Turner in London; Blaise
Robinson in Paris; Writing by Herbert Lash; Editing by Kenneth
Barry)
