* MSCI all-world index gains along with U.S. stocks
* BOJ comments push yen higher vs dollar
* Fed minutes expected during the U.S. session
(Updates prices, adds gold prices, details)
By Caroline Valetkevitch
NEW YORK, May 21 World stock markets and U.S.
bond yields rose on Wednesday on views the Federal Reserve could
raise interest rates more slowly than expected.
The euro declined for a second straight session against the
dollar on expectations of further easing from the European
Minutes from the Fed's last meeting, due 2:00 p.m. (1800
GMT), could shed light on the timing of rate rises. Fed Chair
Janet Yellen said in March the U.S. central bank could raise
rates six months after its bond-buying program ended.
"I suspect they are going to continue this low interest rate
environment, very accommodative monetary policy, for a very long
period of time in an effort to help markets feel a little bit
calmer," said Joseph Tanious, global market strategist at J.P.
Morgan Asset Management.
Adding to that view, New York Federal Reserve President
William Dudley on Tuesday said the Fed would likely be
"relatively slow" in hiking rates.
Earlier on Wednesday, Yellen gave a commencement address at
New York University's commencement ceremony, but did not make
any remarks about the economy or monetary policy.
MSCI's all-world equity index, which tracks
shares in 45 nations, was up 0.3 percent, while European shares
ended up 0.5 percent.
On Wall Street, the Dow Jones industrial average rose
114.28 points or 0.7 percent, to 16,488.59, the S&P 500
gained 7.77 points or 0.41 percent, to 1,880.6 and the Nasdaq
Composite added 10.91 points or 0.27 percent, to
In the foreign exchange market, the dollar fell to a
3-1/2-month low against the yen on optimistic comments from Bank
of Japan Governor Haruhiko Kuroda, who gave no hint of further
monetary easing in the near term.
The dollar fell to 100.805 yen in London trading, but
recovered in New York trading to trade higher at 101.54.
In mid-morning New York trading, the euro fell to one-week
lows against the dollar of $1.3652 and was last at
$1.3661, down 0.3 percent on the day.
"Expectations about additional easing measures in June have
increased since the ECB's last meeting. And the European
elections are also a factor in the euro's weakness," said John
Doyle, director of markets at Tempus Consulting in Washington.
Benchmark 10-year Treasury notes were last down
10/32 in price to yield 2.54 percent compared with 2.509 percent
OIL RISES, GOLD SLIPS
Oil rose to $110 a barrel, supported by an industry report
showing U.S. crude inventories had unexpectedly fallen last week
and by persistent disruption to Libya's output amid renewed
Brent crude gained 38 cents to $110.07 a barrel,
while U.S. crude rose 82 cents at $103.15.
Gold fell, while palladium touched a near three-year high
and platinum rose near a two-month high as labor strikes in top
producer South Africa dragged on. Spot gold was down 0.3
percent at $1,290.30 an ounce.
(Additional reporting by Nigel Stephenson and Alex Lawler in
London; Chuck Mikolajczak and Gertrude Chavez-Dreyfuss in New
York; Editing by John Stonestreet, Toby Chopra, James Dalgleish
and Chizu Nomiyama)