* Investors bet on euro zone stimulus after Draghi's
* Benchmark S&P surges past 2,000 mark for first time
* Yields on most euro zone govt bonds hit record lows
* Euro at 11-month low against the dollar
(Adds U.S. markets opening, changes dateline; previous LONDON)
By Herbert Lash
NEW YORK, Aug 25 Global equity markets rallied
on Monday, with the U.S. benchmark S&P topping the 2,000 mark
for the first time, as expectations grew that the European
Central Bank would loosen its monetary policy in a move to boost
The euro fell to near a one-year low against the dollar and
yields on euro zone government debt fell to historic lows as
investors took the view that ECB President Mario Draghi was
prepared to use all available tools to foster growth.
In a landmark address to central bankers on Friday in
Jackson Hole, Wyoming, Draghi suggested a major shift in ECB
policy toward reviving growth and not focusing on austerity.
Speculation grew that the ECB was preparing a program of
asset purchases to counter wilting inflation when it meets next
week, driving yields on bonds from Germany, France, Italy,
Spain, Portugal, Ireland and elsewhere to all-time lows.
European stocks rallied, and Wall Street followed, with the
S&P surging to above 2,000 for the first time.
"European investors came in today with the mindset that
we're going to have a more supportive fiscal and monetary policy
stimulus, and therefore we ought to see better times ahead in
terms of economic growth and corporate earnings," said Phil
Orlando, chief equity market strategist at Federated Investors,
in New York. "Europe is essentially driving the U.S.," he said.
The Dow Jones industrial average was up 121.37
points, or 0.71 percent, at 17,122.59. The Standard & Poor's 500
Index was up 13.34 points, or 0.67 percent, at 2,001.74.
The Nasdaq Composite Index was up 29.34 points, or 0.65
percent, at 4,567.89.
In Europe, the FTSEurofirst 300 index of top
regional shares rose 1.1 percent to close at 1,366.16.
MSCI's all-country world index rose 0.56
The benchmark 10-year U.S. Treasury note was unchanged,
yielding 2.4015 percent. But European debt rallied, with the
10-year German bund hitting a record low of 0.926
percent, before pulling back to yield 0.956 percent.
The dollar rose as the euro dropped on weak German economic
data and Draghi's comments.
The euro skidded against the dollar to $1.3184 at one
point after news that Germany's Ifo business climate index fell
to 106.3 from 108, its lowest since September 2013. The euro was
last trading at $1.3199, down 0.32 percent on the day.
Brent crude traded just above $102 a barrel, while ample
supply and weak demand dampened prices for U.S. crude.
Brent crude was up 33 cents to $102.66. U.S. crude
was down 11 cents at $93.54 a barrel.
S&P 500 crosses 2,000 level: link.reuters.com/zec72w
(Reporting by Herbert Lash; Additional reporting by Francesco
Canepa in London; Editing by Dan Grebler)