GLOBAL MARKETS-Stocks rally for 9th day; euro holds steady

                                
 * World stocks rally for ninth-straight session
                                
 * Euro holds near 3-week high versus U.S. dollar
                                
 * U.S. debt prices fall in light volume
                                
 * Gold hits record on safe-haven demand
 (Updates with opening of U.S. markets, adds byline, dateline)
                                
 By Herbert Lash and Jeremy Gaunt
                                
 NEW YORK/LONDON, June 18 (Reuters) - World stocks rose for
a ninth straight day on Friday as investors increased their
risk appetite after a Spanish bond auction eased their worst
fears about euro zone sovereign debt, helping the euro hold at
three-week highs.
                                
 MSCI's all-country world index <.MIWD00000PUS> gained about
0.5 percent, allowing U.S. and European shares to retrace all
their losses for this year. The index has rebounded around 7
percent since its June 7 close and gained more than 3 percent
this week.
                                
 Its emerging markets counterpart <.MSCIEF> outperformed and
was up almost 0.7 percent.
                                
 The euro steadied around $1.24 as it headed toward its
biggest weekly gain in more than a year as investors unwound
large short positions accumulated during the currency's
sell-off in recent months. [ID:nN18130066]
                                
 "We had some nice euro gains and dollar weakness over the
course of this week. We're going to see whether the euro is
going to sustain these gains and press on toward $1.25," said
Brian Dolan, chief strategist at Forex.com in Bedminster, New
Jersey.
                                
 The euro <EUR=> was up 0.04 percent at $1.2383.
                                
 The U.S. Dollar Index <.DXY> was down 0.08 percent at
85.621, and against the yen, the dollar <JPY=> was down 0.22
percent at 90.78.
                                
 U.S. stocks rose in early trading and were set for
back-to-back weekly gains, as investors juggled with the
expiration of stock options.
                                
 Basic materials companies took the lead in a market that
traded in a very tight range. Eastman Chemical <EMN.N> gained
2.2 percent and the S&P materials index <.GSPM> edged up 0.6
percent.
                                
 The Dow Jones industrial average <.DJI> edged up 40.66
points, or 0.39 percent, to 10,474.60. The Standard & Poor's
500 Index <.SPX> added 4.35 points, or 0.39 percent, to
1,120.08. The Nasdaq Composite Index <.IXIC> rose 13.80 points,
or 0.60 percent, to 2,320.88.
                                
 Investors have gradually been moving back into riskier
assets this month after a sharp correction in May made
valuations more attractive and key volatility gauges, such as
Wall St's Vix index, almost halved from mid-May peaks.
                                
 Spain's Treasury sold 3.5 billion euros of debt on
Thursday, and a government official said the sale gave it
enough liquidity to deal with a 24 billion euro ($29.4 billion)
repayments crunch in July.
                                
 In addition, EU leaders and officials on Friday firmed up
plans to publish bank "stress tests" next month as they looked
to minimize adverse speculation that has been dogging the
sector all year.
                                
 But investors in commodities overlooked increased risk
appetite in the wider markets as oil and copper prices faltered
on signs economic growth in the United States and China may not
be as rapid as expected. [ID:nSGE65H07V]
                                
 A Chinese official said growth was expected to slow in the
second half of this year and that double-digit growth for the
full year seemed unlikely. [ID:nTST000214]
                                
 The warning, which prompted a sell-off in Chinese equities,
followed U.S. data on Thursday showing jobless claims increased
unexpectedly last week as the manufacturing, construction and
education sectors shed workers. [ID:nN17254724]
                                
 "The recovery is going to be quite slow in a number of
countries," said Daniel Smith, an analyst at Standard
Chartered.
                                
 U.S. light sweet crude oil <CLc1> was up 18 cents to $76.97
per barrel after earlier trading lower.
                                
 Gold rallied to a record high near $1,260 an ounce as
momentum triggered by buying of the metal as a haven from
sovereign and financial risk pushed prices through technical
resistance to near their previous peak. [ID:nLDE65H0HL]
                                
 U.S. Treasury prices drifted lower in light trading as the
market cleaved tightly to a yield range established over the
past week and a half, with little on the agenda to influence
prices. [ID:nN18122591]
                                
 "It is a classic summer Friday with no economic data and
much of the market dreaming about an early close to make it a
long weekend," said Ian Lyngen, senior government bond
strategist at CRT Capital Group in Stamford, Connecticut.
                                
 The benchmark 10-year U.S. Treasury note <US10YT=RR> was
down 8/32 in price to yield 3.2213 percent.
 (Reporting by Rodrigo Campos, Wanfeng Zhou in New York;
Christopher Johnson in London; Writing by Herbert Lash; Editing
by Dan Grebler)