* Euro climbs to as high as $1.3660, dollar weakens
* Stocks gain as mixed corporate results temper rally
* U.S. crude oil prices fall more than $1
By Walter Brandimarte and Alina Selyukh
NEW YORK, Jan 24 (Reuters) - The euro climbed further on
Monday on hopes the euro zone is on track to stabilize its
debt problems while stocks rose as investors tried to revive a
rally that had pushed world equities to August 2008 levels.
Oil prices fell more than $1 a barrel as inventories rose
and investors looked to the stock market for direction.
Investors also were cautious before the U.S. Federal Reserve's
first monetary policy meeting this year on Tuesday and
Wednesday.
The euro <EUR=EBS> ran as high as $1.3660 on trading
platform EBS, a fresh two-month high against the dollar. It
was later trading up 0.31 percent at $1.3657.
The single European currency was also supported by
technical momentum after breaking key levels last week, but
analysts feared the rally was close to an end as political
turmoil in Ireland was a reminder of the uncertainties
plaguing the most indebted European countries.
For details on Ireland's political woes: [].
"The euro's had a sharp rebound recently, but we think
it's nearing its top in the bigger picture," said Ian
Stannard, senior currency strategist at BNP Paribas.
"It's supported in the near-term by optimism over talks on
the European rescue fund, but political problems in Ireland
and Portugal show there are still lots of factors out there to
hurt the currency," he added.
The U.S. dollar slipped 0.4 percent against a basket of
major currencies, according to the U.S. Dollar Index <.DXY>.
Against the Japanese yen <JPY=>, it was nearly flat at 82.57.
STOCKS MODESTLY HIGHER
Global stocks scored moderate gains as mixed corporate
results tempered markets after a multi-week rally. Analysts
said, however, that stocks would need positive surprises to
keep rising.
"It's going to be tough for us to move higher since we
need to digest the long period we had of nice gains with
little volatility," said Wayne Kaufman, chief market analyst
at John Thomas Financial in New York.
"We'd need really very good earnings numbers and forecasts
to continue up, and so far the numbers have been just OK."
The Dow Jones industrial average <> extended its
eighth week of gains, rising 76.06 points, or 0.64 percent, to
11,947.90. The Standard & Poor's 500 Index <.SPX> added 5.82
points, or 0.45 percent, to 1,289.17, and the Nasdaq Composite
Index <> rose 21.14 points, or 0.79 percent, to
2,710.68.
Global fast-food giant McDonald's Corp <MCD.N> pressured
markets after it reported a fourth-quarter profit in line with
expectations but disappointing December sales. []
In Europe, Philips Electronics <PHG.AS> weighed on
blue-chips after reporting lower-than-expected fourth-quarter
net profit on poor TV sales and predicting tepid consumer
spending in mature markets this year.
World shares as measured by the MSCI All-Country World
Index <.MIWD00000PUS> advanced 0.6 percent, while the
FTSEurofirst 300 <> index of top European shares was up
0.3 percent after data showed uneven growth in the euro zone's
services sector. []
U.S. crude oil prices <CLc1> fell $1.00, or 1.12 percent,
to $88.11 per barrel in choppy trading, even as heating oil
futures were lifted by U.S. cold weather.
Still weighing on oil prices was last week's U.S. data
showing an increase in oil inventories against forecasts for
lower stockpiles.
Prices of U.S. Treasuries were flat to slightly higher as
traders made adjustments in advance of upcoming supply and the
Fed's meeting. The benchmark 10-year note <US10YT=RR> was up
2/32 in price, with the yield at 3.40 percent.
The Fed is expected to buy $29 billion in U.S. debt,
buying Treasuries on four of five trading days this week. It
will also issue a policy statement on Wednesday after its
meeting.
(Reporting by Walter Brandimarte and Alina Selyukh;
Additional reporting by Ryan Vlastelica, Ellen Freilich,
Wanfeng Zhou and Atul Prakash; Editing by Jan Paschal)
