GLOBAL MARKETS-World stocks, dollar gain on U.S. housing data

                                
 * Slightly improved housing data gives markets a boost
                                
 * Stocks gain, commodities rebound on U.S. housing data
                                
 * Euro falls vs dollar even as Greek aid seems possible
                                
 * Bonds trade flat after U.S. home sales for February
 (Updates with close of European markets)
                                
 By Herbert Lash
                                
 NEW YORK, March 23 (Reuters) - Global stocks edged higher
and the U.S. dollar rose on Tuesday after sales of previously
owned U.S. homes fell less than expected in February, a sign
for some that the U.S. housing crisis was near a bottom.
                                
 Traders and analysts took a report from the National
Association of Realtors on the February home sales as a sign of
stabilization, especially considering the stormy weather that
buffeted much of the United States last month. For details see:
[ID:nN23249604]
                                
 Major U.S. stock gauges rose after the trade group said
sales fell 0.6 percent month-over-month to an annual rate of
5.02 million units in February, slightly better than analysts'
expectations of a drop to 5 million units.
                                
 A separate report showed home prices in January declined
less than the previous month. Prices of U.S. single-family
homes fell for a second straight month, but the pace of
deceleration eased, the Federal Housing Finance Agency said.
[ID:nN23247082]
                                
 Commodity prices turned higher as the U.S. housing data
offset worries about debt-stricken Greece, but the gains were
moderate.
                                
 MSCI's all-country equity index <.MIWD00000PUS> rose 0.4
percent after trading close to flat before the U.S. housing
reports. European shares hit a more than 17-month closing high,
while Asian stocks earlier in the day also gained.
                                
 "Our view is that housing is bottoming and beginning a slow
improvement, but we're going to bounce along the bottom for a
while," said Henry Smith, chief investment officer at Haverford
Trust Co. in Philadelphia.
                                
 Wall Street stocks also rose on expectations of stronger
first-quarter earnings, ahead of the close of the quarter next
week.
                                
 Heavy equipment maker Caterpillar Inc <CAT.N> rose 3.1
percent and was the top gainer on the Dow. Wells Fargo raised
its 12- to 18-month stock price target range by $10 to between
$73 to $75.
                                
 Shorly before 1 p.m., the Dow Jones industrial
average<.DJI> was up 40.36 points, or 0.37 percent, at
10,826.25. The Standard & Poor's 500 Index <.SPX> was up 1.87
points, or 0.16 percent, at 1,167.68. The Nasdaq Composite
Index <.IXIC> was up 4.69 points, or 0.20 percent, at
2,400.09.
                                
 The FTSEurofirst 300 index of pan-European blue-chips
<.FTEU3> rose 0.8 percent to 1,073.56 points, its highest close
since early October 2008.
                                
 Gains in oil firm Cairn <CNE.L> and a jump at British
insurer Legal and General <LGEN.L>, which reported
higher-than-expected profits, pulled European shares higher.
                                
 The dollar edged higher versus the Japanese yen on the
housing reports and the euro slid even as Germany signaled for
the first time that it may accept European financial aid for
Greece as a last resort ahead of an EU summit on Thursday.
                                
 But a German official stipulated that the International
Monetary Fund would have to help and euro zone partners must
accept tougher budget discipline rules. [ID:nLDE62M130]
                                
 Greek government bond yields fell, squeezing the yield
spread against German Bunds narrower, as speculation over
possible aid for Greece continued. [ID:nLDE62M1YJ]
                                
 "At the moment the market is worried that Germany are not
going to play ball and hence an EU-wide solution would be
unlikely, so if a solution is forthcoming that would be good
news," said Nick Stamenkovic, rate strategist at RIA Capital
Markets.
                                
 U.S. Treasury prices were mixed. Longer-dated U.S.
Treasuries hovered near break-even to modestly lower as the
aversion to risk abated slightly.
                                
 The benchmark 10-year Treasury note's price, which moves
inversely to its yield, was last down 1/32 on the day to yield
3.67 percent. <US10YT=RR>
                                
 Commodity prices briefly turned higher as the U.S. housing
data offset worries about Greece. Gold eased initial weakness,
with spot gold prices <XAU=> up $4.25 at $1,106 an ounce.
[ID:nN23375069]
                                
 U.S. light sweet crude oil <CLc1> rose 11 cents to $81.71 a
barrel.
 (Reporting by Caroline Valetkevitch, Vivianne Rodrigues,
Burton Frierson in New York; Christopher Johnson in London;
writing by Herbert Lash; Editing by Leslie Adler)