GLOBAL MARKETS-Stocks, oil rise ahead of Fed policy verdict

* MSCI world equity index up 0.7 pct at 283.74

* Fed seen keeping current supportive policy in place

* Gold hits record high; dollar under pressure

By Natsuko Waki

LONDON, Nov 4 (Reuters) - World stocks rose from the previous day's four-week low on Wednesday while the dollar slipped ahead of a policy decision by the Federal Reserve, expected to affirm its commitment to ultra-low interest rates.

A survey showed the euro zone's dominant service sector expanded for the second consecutive month and at its fastest pace in 22 months, adding to encouraging economic signs, though Germany's expanded at its slowest rate in three months. [PMI]

The Fed is expected to pledge to hold benchmark interest rates exceptionally low for "an extended period" while acknowledging some positive economic development.

"The Fed is unlikely to offer any hints into the timing of an exit strategy and eventual rate rises, which may help stocks to rise and consequently boost (the euro)," said Antje Praefcke, currency strategist at Commerzbank in Frankfurt. The MSCI world equity index .MIWD00000PUS rose 0.7 percent while the FTSEurofirst 300 index .FTEU3 gained 0.9 percent.

Markit's final euro zone services purchasing managers' index of around 2,000 companies rose in October to 52.6, its highest reading since December 2007, up from 50.9 in September.

That was revised up from forecasts and a flash reading of 52.3.

Emerging stocks .MSCIEF rose 1.6 percent.

M&A BOOST

Tuesday's news that Warren Buffett's Berkshire Hathaway agreed to buy Burlington Northern Santa Fed Corp (BNI.N) in a deal that values the railroad company at $34 billion was seen as a sign corporate merger and acquisition activity is picking up, given low valuations.

More takeover deals would encourage investors to buy companies seen as potential targets in aid of benefitting from the eventual deal. It may also signal buyers are more optimistic about the economy and financing.