* Jobless claims rise more than expected last week
* VIX fear gauge falls
* Indexes up: Dow 1.5 pct, S&P 1.3 pct, Nasdaq 1.2 pct
* For up-to-the-minute market news see []
(Updates to midmorning)
By Angela Moon
NEW YORK, Nov 4 (Reuters) - U.S. stocks rose sharply on
Thursday as more monetary stimulus from the U.S. Federal
Reserve aimed at helping the ailing economy fueled investor
risk appetite.
The Fed's plan to buy $600 billion in Treasuries, announced
on Wednesday, boosted risky assets including equities and
commodities while sending the U.S. dollar <.DXY> down more than
1 percent against a basket of major currencies.
The CBOE Volatility Index VIX <.VIX>, Wall Street's
so-called fear gauge, fell nearly 6 percent. VIX options
activity on Wednesday indicated smooth sailing for stocks as
traders scooped up bearish puts on the index. The gauge usually
moves inversely with the S&P 500, tracking option prices
investors are willing to pay as a protection on the underlying
stocks.
Investors were not derailed by the latest economic data
showing U.S. claims for unemployment benefits rose more than
expected last week, underlining persistent weakness in the
labor market. For details, see []
"On the one hand, this (Fed's stimulus) was smaller than
many investors were initially hoping for. On the other, as
expectations for the size of the program came down over the
past few weeks, the dollar stabilized," UBS analysts said in a
note.
"In our view, this was a significant positive as additional
QE (quantitative easing) could have led to a regime of
competitive currency devaluation (beggar thy neighbor policy).
This would run the risk of being a destabilizing force,
damaging global growth. As such, we are pleased with a slightly
smaller program."
The Dow Jones industrial average <> was up 166.24
points, or 1.48 percent, at 11,381.37. The Standard & Poor's
500 Index <.SPX> was up 15.30 points, or 1.28 percent, at
1,213.26. The Nasdaq Composite Index <> was up 29.94
points, or 1.18 percent, at 2,570.21.
MSCI's all-country world stocks index <.MIWD00000PUS> rose
2 percent to two-year highs and reached levels just before the
collapse of Lehman Brothers.
Energy and material stock were the top gainers, with the
S&P energy index <.GSPE> and materials index <.GSPM> both up
2.2 percent.
Financial stocks also rose as the two-year yield dipped to
a record low. The S&P financial index <.GSPF> was up 1.4
percent.
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For PDF on Fed decision:
http://r.reuters.com/cyh73q
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U.S. retailers from discounter Target Corp <TGT.N> to teen
apparel chain Zumiez Inc <ZUMZ.O> reported October same-store
sales above expectations, helped by unique merchandise and
cheap prices. Target rose 4 percent to $56.12, while the S&P
retail index <.RLX> gained 1.7 percent. []
U.S.-listed shares of BHP <BLT.L><BBL.N> were up 6 percent
at $78.46 after the Canadian government blocked its bid for
Potash Corp of Saskatchewan Inc <POT.TO>. New York-traded
shares of Potash <POT.N> fell 3.7 percent to $140.21.
[]
U.S.-listed shares of Unilever Plc <ULVR.L><UL.N> jumped
6.2 percent to $31.17 after it matched forecasts with a rise in
third-quarter sales. []
(Reporting by Angela Moon; Editing by Jeffrey Benkoe)
