* Euro ministers encourage stock markets
* Euro up vs dollar after prior session multi-yr lows
* U.S. bond prices rise as risk-aversion still up
(Updates to U.S. markets, changes byline, dateline, previous
LONDON)
By Manuela Badawy and Claire Milhench
NEW YORK/LONDON, May 18 (Reuters) - U.S. stocks opened
higher on Tuesday as investors became more optimistic on the
progress that euro-zone finance ministers were making on
Greece's rescue package, while the euro recovered from the
prior session's four-year low.
Global markets steadied as investors were encouraged by
comments from European ministers that they will clarify this
week some technical and legal details of the 750 billion euro
($925 billion) rescue plan [].
Prices of U.S. Treasury debt, seen as a safe haven
investment, ticked higher as demand was still strong because
worries about euro zone debt problems in the longer term showed
few signs of easing.
Helping to calm investors' jitters, officials said Greece
received a 14.5 billion euro emergency loan from the EU, and
would use some of the money to fully repay a 8.5 billion euro
bond maturing on Wednesday.
The 10-year Greek/German government bond yield spread
tightened and the cost of insuring against a Greek default
fell, helping to support the euro.
"The euro has been oversold so there is at least a bounce
in the short term," said Carol Hurley, senior market strategist
at Lind-Waldock in Chicago. "But longer term, the euro could go
to parity (with the dollar), maybe even by the end of the
year."
The euro <EUR=> rose 0.23 percent from the previous
session's close to $1.2422. Against the Japanese yen, the
dollar <JPY=> was up 0.19 percent at 92.76 from a previous
session close of 92.580.
In the U.S. stock market, the Dow Jones industrial average
<> added 76.55 points, or 0.72 percent, to 10,702.38, also
getting support from solid earnings results from Wal-Mart and
Home Depot.
The Standard & Poor's 500 Index <.SPX> gained 8.37 points,
or 0.74 percent, to 1,145.31. The Nasdaq Composite Index
<> rose 20.12 points, or 0.85 percent, to 2,374.35.
World stocks as measured by the MSCI All-Country index
<.MIWD00000PUS> were up 1.18 percent while its emerging markets
component <.MSCIEF> was up 0.9 percent.
The FTSEurofirst 300 <> index of top European shares
edged up 1.78 percent, with banks and commodity stocks such as
energy and mining companies gaining.
"I would see these gains (in equities) as more of a pause
than the start of an uptrend. The market has slowly but
certainly realized that the problems that Europe has are quite
severe," said Philippe Gijsels, head of research at BNP Paribas
Fortis Global Markets in Brussels.
Earlier, Asian stocks had fallen to three-month lows as
traders continued to fret about the impact that euro zone
spending cuts would have on exporters in the region. In Japan,
the Nikkei <> closed little changed after a choppy
session.
(Additional reporting by Nick Olivari in New York and
Harpreet Bhal in London, Editing by Chizu Nomiyama)
