* Fed minutes, Intel results whet risk appetite
* MSCI benchmark stock index highest since mid-April
* Dollar drops as Fed seen easing; gold hits record high
(Updates with U.S. markets' close)
By Walter Brandimarte
NEW YORK, Oct 13 (Reuters) - World stocks jumped to a
six-month high, gold hit another record, and the dollar
weakened on Wednesday on expectations that the Federal Reserve
will further loosen monetary policy, boosting risk appetite.
Gold prices reached an all-time high of $1,374.15 an ounce
as investors sought protection against a sinking dollar. Other
commodities also climbed -- oil prices shot up 1.6 percent to
close just above $83 a barrel.
Japanese stocks were headed to a tepid start, however, with
Nikkei futures traded in Chicago <NKZ0> falling 5 points to
9,520.00. Investors have been cautious about Japan's equity
market as the yen remains close to a 15-year high against the
dollar, making stocks more expensive for foreigners.
Minutes from the Federal Reserve's Sept. 21st meeting,
which were released on Tuesday, showed officials discussed the
possibility of buying more longer-term U.S. government debt to
drive borrowing costs lower. They also mulled ways to nudge the
public into expecting higher levels of inflation in the future
to spur spending.
"The Fed minutes certainly induced a rally right across the
board," said Peter Cardillo, chief market economist at Avalon
Partners in New York. "We are seeing the dollar lower, gold and
oil prices higher. That is adding risk flavor to the market."
Stocks also benefited from strong corporate results from
JPMorgan Chase & Co <JPM.N> and Intel Corp <INTC.O>.
MSCI's benchmark All-Country World equity index
<.MIWD00000PUS> rose as much as 1.25 percent during the day to
an intraday peak at 1,226.07, its highest level since
mid-April. The index closed at 1,222.06, up 1.18 percent.
All three major U.S. stock indexes closed at their highest
levels in five months. Industrials and materials sectors led
the way as commodity prices soared on data showing China's
month-on-month import numbers hit a record high.
The Dow Jones industrial average <> advanced 75.68
points, or 0.69 percent, to close at 11,096.08, while the
Standard & Poor's 500 Index <.SPX> rose 8.33 points, or 0.71
percent, to 1,178.10. The Nasdaq Composite Index <> gained
23.31 points, or 0.96 percent, end at to 2,441.23.
Despite beating profit expectations, JPMorgan's shares
slipped 1.4 percent to $39.84 as its weak revenue highlighted
feeble loan demand and declining trading volumes in the
industry. [].
Intel dropped 2.7 percent to $19.24 after its shares had
risen in the past six sessions.
The FTSEurofirst 300 <> index of top European shares
rose 1.42 percent to close at 1,086.52, a three-week high. The
index was boosted by shares of miners such as BHP Billiton
<BLT.L>, which jumped 4.16 percent.
AUSSIE NEARS PARITY
The prospect of a second round of U.S. quantitative easing,
which equates to printing more money, pushed the Australian
dollar to its highest level against the U.S. dollar since the
Aussie was allowed to float freely in 1983.
The Australian dollar <AUD=><AUD=D4> climbed as high as
US$0.9937, less than 1 cent to parity.
The U.S. dollar also weakened to an eight-month low against
the euro.
Dollar losses were limited, however, after the euro failed
again to hold above the key psychological $1.40 mark. The
dollar's recovery accelerated after automatic buy orders were
triggered, traders said.
The euro <EUR=> was up 0.32 percent at $1.3962. It had
earlier risen as high as $1.4002 on trading platform EBS -- not
far from its eight-month high of $1.4030 hit last week.
The dollar also posted losses against a basket of major
trading-partner currencies, with the U.S. Dollar Index <.DXY>
down 0.34 percent. Against the Japanese yen, the greenback
<JPY=> was unchanged at 81.76.
GOLD HITS RECORD
Gold hit a record high at $1,374.15 an ounce as the dollar
weakened globally. It was trading at $1,371.60 an ounce later,
still 1.63 percent above Tuesday's close.
Gold prices have rallied nearly 25 percent so far this year
as investors turned to the metal as a haven from the effects of
an increasingly loose monetary policy in the United States.
"Because we are in a world of quantitative easing in the
developed economies, and as QE is almost synonymous with
competitive devaluation ... gold and the precious metals (are)
taking on the function of an alternative currency," said Ashok
Shah, chief investment officer of London & Capital.
U.S. crude oil <CLc1> rose 1.64 percent, or $1.34, to
settle at $83.01 per barrel after data showed China, which has
surpassed the United States as the world's biggest energy user,
set a record 35 percent increase in September crude oil imports
from a year earlier.
U.S. Treasury prices rose on prospects the Fed could buy
long-dated bonds in a second round of monetary policy easing.
The benchmark 10-year note <US10YT=RR> rose 3/32 in price,
overcoming its earlier loss of half a point, or 16/32. The
10-year note's yield, which moves in the opposite direction of
its price, dipped to 2.4202 percent, down from 2.424 percent
late on Tuesday.
(Reporting by Walter Brandimarte; Additional reporting by
Amanda Cooper in London; Chuck Mikolajczak and Wanfeng Zhou in
New York; Editing by Jan Paschal)
