* Dow, S&P hit record closing highs on views on Fed
* Dollar slides on comments on keeping Fed stimulus in place
* Treasury yields ease before Yellen's Senate appearance
* Oil gains after flirting with 4-1/2-month low
* Gold breaks four-day drop
By Ellen Freilich
NEW YORK, Nov 13 (Reuters) - U.S. stocks rose while Treasury yields and the dollar fell on Wednesday on expectations that remarks by Federal Reserve Vice Chair Janet Yellen when she appears on Thursday at the Senate Banking Committee will underscore the Fed's accommodative posture.
Opening remarks for Yellen's appearance at the committee for a confirmation hearing on her nomination to head up the Fed, released late Wednesday, gave substance to those expectations, boosting stock futures and bond prices while the dollar extended its slide.
In her remarks, Yellen, who President Barack Obama nominated to take over as Fed chairman when Ben Bernanke's term ends in January, said the U.S. central bank "has more work to do" to help an economy and labor market that still are underperforming.
The U.S. benchmark 10-year Treasury yield eased to 2.70 percent after Yellen's remarks were released.
The hearing by the Senate Banking Committee, which involves a question-and-answer period as well as opening remarks, is set for 10 a.m. (1500 GMT) on Thursday.
"The Fed is going to remain easy and will probably taper later rather than sooner. There were enough question marks in the October employment report and even the recent GDP report that Yellen is not going to want to change direction very quickly," said Bob Gelfond, chief executive officer of MQS Management, a New York City-based investment advisor.
Most dealers who underwrite U.S. Treasury issuance think the Fed will not start to trim its bond purchases until March 2014 or later, according to a Reuters poll done Friday after the release of the October U.S. employment data.
As the Fed continues to buy $85 billion a month in U.S. Treasuries and mortgage-backed securities, the Treasury's $24 billion 10-year note auction was well received on Wednesday.
The Treasury will sell $16 billion of 30-year bonds on Thursday.
Earlier Wednesday, global equity markets had slipped on weaker-than-expected data from the euro zone and on some investors' disappointment with the communique from China's third plenum. On Wall Street, stocks opened lower in line with that overnight trend before moving into the plus column.
Department store operator Macy's Inc reported a rebound in third-quarter sales and said its business was improving as the holiday season nears, adding to the positive tone on Wall Street. Shares of Macy's reached a record closing high, finishing up 9.4 percent at $50.68, and helping to drive up other consumer discretionary shares.
"Macy's reported blowout numbers. It's had a positive impact on everything else consumer related today. I think people's expectations were pretty low for holiday shopping, and I think that woke a lot of people up," said Michael James, managing director of equity trading at Wedbush Securities in Los Angeles.
The Dow Jones industrial average closed up 70.96 points, or 0.45 percent, at 15,821.63. The S&P 500 closed up 14.31 points, or 0.81 percent, at 1,782.00. the Nasdaq closed up 45.655 points, or 1.16 percent, at 3,965.575.
DOUBTS ON EURO ZONE RECOVERY, CHINA PLENUM PLANS
Doubts about the euro zone's recovery and the lifespan of Britain's record-low interest rates hurt stock prices there and in the euro zone.
Britain's FTSE took its biggest fall in over a month and Europe's FTSEurofirst tumbled 0.56 percent as signs of a strengthening UK economy but worse-than-expected euro zone factory data hit markets from opposing sides.
Investors have been buying U.S. and European assets on the view that both regions' economies are recovering, but not strongly enough to let central banks reduce stimulus.
China's CSI300 share index fell 2.2 percent, its biggest loss in four months. China's leaders, after a four-day plenum, left markets unimpressed with their reform agenda.
"There's a sense of dissatisfaction with the Third Plenum, though investors shouldn't have expected too many details," said Brian Jacobsen, chief portfolio strategist at Wells Fargo Funds Management in Menomonee Falls, Wisconsin. "And there is a growing fear that the euro zone may go the way of Japan in the 1990s and 2000s with deflation and dismal growth."
DOLLAR FALLS INTO LINE
The dollar first rose against the euro on news the European Central Bank could start to buy assets or cut its deposit rate into negative territory to push inflation up to its target.
But it slid as sentiment focused on the prospect for a long period of easy monetary policy from the Federal Reserve.
Fed officials this week have spoken of the need to keep the U.S. central bank's economic stimulus in place, and Yellen is expected to take a similar stance.
The euro, however, was resilient, rising even though European Central Bank Executive Board member Peter Praet said the ECB could start buying assets or cut its deposit rate into negative territory to trigger a rise in inflation to the central bank's target.
In afternoon trade, the dollar index was down 0.3 percent, led by gains in the euro, which rose 0.2 percent to $1.3463.
MSCI's emerging market index lost about 1.2 percent as it notched its 10th straight session of falls and hit its lowest levels since mid-September.
In commodities markets, gold stood at $1,273.06 an ounce. U.S. crude for December delivery rose $0.75 to $93.77 a barrel after flirting with 4-1/2-month lows, while Brent gained $1.31 to $107.12. Oil was helped as supply outages countered concerns about reduced U.S. monetary stimulus and a forecast rise in U.S. stockpiles.