* U.S. stocks rise after strong economic data
* U.S. dollar firm on US economic data
* U.S. Treasuries down as risk appetite increases
(Updates with U.S. markets, changes byline, dateline, previous
LONDON)
By Manuela Badawy
NEW YORK, Feb 17 (Reuters) - U.S. stocks opened higher and
the U.S. dollar recovered some ground on Wednesday helped by
better U.S. economic data, though concern lingered about fiscal
problems in Europe.
European shares were trading at two-week highs as
forecast-beating results from BNP Paribas <BNPP.PA> fueled
confidence in the banking sector.
MSCI world equity index <.MIWD00000PUS> rose 0.8 percent,
while the pan-European FTSEurofirst 300 <> index of top
European shares was up 1.39 percent at the highest since early
February. The benchmark index is up 56 percent since hitting a
record low in March 2009.
U.S. stocks were also boosted by strong results from farm
equipment maker Deere & Co <DE.N>.
The Dow Jones industrial average <> was up 28.11
points, or 0.27 percent, at 10,296.92. The Standard & Poor's
500 Index <.SPX> was up 2.98 points, or 0.27 percent, at
1,097.85. The Nasdaq Composite Index <> was up 7.01
points, or 0.32 percent, at 2,221.20.
"Evaluating the whole (U.S. earnings) season, (of) the
companies that have reported so far, about two-thirds have
beaten on revenues (and) about three-quarters have beaten on
earnings, so the earnings season has been terrific," said Phil
Orlando, chief equity market strategist at Federated Investors
in New York.
"And other issues, the most recent of which is Greece, are
starting to dissipate and maybe this nascent improvement in
share prices we've seen the past couple of days has legs."
In currencies, the dollar was up against a basket of major
trading-partner currencies, with the U.S. dollar index <.DXY>
up 0.7 percent at 80.235.
The euro <EUR=> was down 0.56 percent at $1.3691. Against
the yen, the dollar <JPY=> was up 0.93 percent at 90.94 yen
from a previous session close of 90.100.
The U.S. Commerce Department reported on Wednesday that
housing starts hit their highest in six months while Federal
Reserve data showed industrial output rose a solid 0.9 percent
in January, signs that an economic recovery was taking a firm
hold as the year began.
Groundbreaking for new homes increased 2.8 percent to a
seasonally adjusted annual rate of 591,000 units while new
building permits, which give a sense of future construction,
fell 4.9 percent to 621,000 units last month after rising to a
14-month high of 653,000 in December, the Commerce Department
said. That compared to analysts' forecasts for 620,000 units.
"We have seen the dollar rally a bit here as the data has
come out slightly more positive than expected. The building
permit data also registered slightly stronger than expected,"
said John Doyle, currency strategist at Tempus Consulting in
Washington.
"It's a sign of future construction and (shows) a
stabilizing housing market. The dollar is trading on that data
right now and I think investors' sentiment will shift to focus
on the FOMC meeting minutes to be released later today."
The Fed -- the U.S. central bank -- will release minutes
from the Jan. 26-27 Federal Open Market Committee policy
meeting later in the day.
Housing, which is at the core of the most painful economic
downturn since the Great Depression, is crawling out of a
three-year slump, supported by government programs. New home
construction contributed to economic growth in the third
quarter of 2009 for the first time since 2005. For more see
[].
U.S. bonds were left out of favor compared to stocks, which
tend to perform better during times of economic growth. The
benchmark 10-year Treasury note <US10YT=RR> was last down 12/32
in price, yielding 3.71 percent.
Stocks gained worldwide on rekindled investor risk
appetite, which had taken a hit from concerns about the swollen
debt of Greece and other euro zone countries.
European ministers told Athens on Tuesday it may need to
take further steps to bring its debt under control and calm
"irrational" financial markets.
In Asia, Japan's Nikkei average <> surged 2.7 percent
on Wednesday, chalking up the stock index's biggest daily rise
in over two months, as investors snapped up Mitsubishi Corp
<8058.T> and other resource-related stocks after a jump in
commodities prices.
(Additional reporting by Chuck Mikolajczak and Wanfeng Zhou in
New York and Natsuko Waki in London; Editing by James
Dalgleish)
