GLOBAL MARKETS-S&P at record ahead of Fed meeting, euro rises


* Euro up on ECB official's comments

* Brent dips, holds near $109 as Libyan output stays low

* Markets keep tight ranges as Fed decision looms

By Rodrigo Campos

NEW YORK, Oct 29 (Reuters) - The S&P 500 hit a record onTuesday, leading global shares higher ahead of a Federal Reservemeeting on the future of its stimulus program, while the euroneared a two-year high against the U.S. dollar.

Brent crude gave back some of Monday's gains but hoverednear $109 as Libya's output stayed low, while other marketstraded in tight ranges. Most investors expect the U.S. centralbank will vote to extend the current $85 billion monthlybond-buying stimulus into next year.

Markets were thrown for a loop in mid-September, when theexpectation was high for the Fed to start trimming its monthlypurchases, aimed at fueling recovery.

Although many are wary of surprises when the Fed publishes astatement after its two-day meeting on Wednesday, most see therecent rally in riskier assets and a dollar selloff as largelyfactoring in the decision.

On Wall Street, stocks rose modestly at the open, with theS&P 500 hitting an intraday record high for a third straightday.

"There's a lot of buyer's fatigue in the market right now.We're up more than 20 percent this year, markets have beenthrough a lot and we're sitting at all-time highs. No one wantsto over-commit in that environment," said Oliver Pursche,president of Gary Goldberg Financial Services in Suffern, NewYork.

The Dow Jones industrial average rose 56.29 points,or 0.36 percent, at 15,625.22. The Standard & Poor's 500 Index was up 5.26 points, or 0.30 percent, at 1,767.37. TheNasdaq Composite Index was up 3.91 points, or 0.10percent, at 3,944.04.

MSCI's world equity index edged up 0.1percent, trading within last week's range.

In Europe, BP and Saipem were among the topgainers on the FTSEurofirst 300 index, which was up 0.2percent.


The euro hit a session high at $1.3813, near a two-year highof $1.3832 hit Friday, after the European Central Bank'sEwald Nowotny said he does not see any tool the ECB could use toweaken the eurozone's currency.

The euro was up 0.2 percent at $1.3808, though the upcomingFed policy decision remained however as the dominant factor inthe currency and fixed income markets.

The dollar gained 0.15 percent against a basket ofcurrencies to 79.365 on thin volume, as many playerswithdrew from the market ahead of the Fed meeting.

U.S. Treasuries prices were little changed as mildlyencouraging data on housing and retail sales reduced bids forbonds, although yields remained close to three-month lows.

"The market is directionless. There is no urgency to pushyields higher or lower," said Lou Brien, market strategist atDRW Trading in Chicago.

The light trading volume suggested traders were reluctant tomake big bets ahead of the Fed meeting and as the TreasuryDepartment sought to sell $96 billion in coupon-bearing debtthis week.

Benchmark 10-year Treasury notes were down 2/32, the yield at 2.5179 percent.

Spot gold, which has risen almost 8 percent from athree-month low in mid October, fell 0.1 percent to around$1,350 an ounce.

Brent crude fell 0.7 percent to $108.88 a barrel,though traders said this was a consolidation after a 2.5 percentgain the previous day, when reports of a sharp drop in Libyanoil exports rekindled worries over global supply. U.S. crude was off 0.4 percent at $98.28.

Libya's crude oil exports have dropped to less than 10percent of capacity as the government has struggled to reach adeal with protesters blocking its big eastern facilities, withsome demanding a greater share of the oil wealth.

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