* Global stocks gain on surprise Abu Dhabi aid to Dubai
* Oil slips below $70 a barrel on plentiful inventories
* Bonds ease as stock gains override safe-haven buying
* Dollar dips vs euro on Dubai news; Fed meeting in focus
(Updates with close of U.S. markets)
By Herbert Lash
NEW YORK, Dec 14 (Reuters) - U.S. stocks surged to fresh
closing highs for 2009 and the euro gained against the U.S.
dollar on Monday after Abu Dhabi's $10 billion in aid to help
Dubai avoid a default boosted appetite for riskier assets.
The dollar slipped after Dubai's bailout eased fears of a
potential debt default that had rattled markets and lifted the
U.S. currency last week on a flight to safety bid.
[]
Gold advanced moderately and copper prices firmed on the
news, while most U.S. Treasury debt prices fell on a reduced
safe-haven buying of bonds. For details, see: []
[] []
Oil, meanwhile, slid for the ninth consecutive day as weak
fuel demand overshadowed stock gains and the weaker dollar.
[]
The Dow industrials and Standard & Poor's 500 Index ended
the day at 14-month closing highs, while the Nasdaq finished at
a 15-month closing high. []
Stocks were also propelled by Exxon Mobil Corp's <XOM.N>
$30 billion takeover bid for natural gas supplier XTO Energy
Inc <XTO.N> and plans by Citigroup Inc <C.N> to repay the U.S.
government about $20 billion in bailout funds.
But lingering worry over debt woes elsewhere capped euro
gains and investors were cautious ahead of a meeting of Federal
Reserve policy-makers this week that may provide clues about
how the Fed -- the U.S. central bank -- intends to exit its
current ultra-loose monetary policy.
"Abu Dhabi helped risk-taking overnight and that hurt the
dollar, but we're at an interesting point heading into the Fed
meeting," said Dan Cook, senior analyst at IG Markets in
Chicago.
"(Fed Chairman Ben) Bernanke has said rates will stay low,
but people are starting to think the Fed at some point will
have to consider raising them," Cook said.
The Dow Jones industrial average <> closed up 29.55
points, or 0.28 percent, at 10,501.05. The Standard & Poor's
500 Index <.SPX> gained 7.70 points, or 0.70 percent, at
1,114.11. The Nasdaq Composite Index <> climbed 21.79
points, or 0.99 percent, at 2,212.10.
Oil pared losses after the Dubai news but settled lower.
Oil prices have fallen more than $8 a barrel this month in the
longest price slide since July 2001 as rising U.S. inventory
levels show a sluggish recovery in demand.
Crude for January delivery <CLc1> fell 36 cents to settle
at $69.51 a barrel. Brent crude <LCOc1> traded up 1 cent to
settle at $71.89 a barrel.
"The fundamentals of oil demand are weak, and as the year
comes to an end, people have been paying more attention to
them," said Gene McGillian, analyst at Tradition Energy in
Connecticut. "After falling so much, the market is trying to
stem the slide but it hasn't really happened yet."
The benchmark 10-year U.S. Treasury note <US10YT=RR> traded
at break-even and was priced to yield 3.55 percent in light
trade, absent any major economic data and caution before the
Fed meeting.
"There doesn't seem to be anything going on today," said
Lee Olver, fixed income strategist at SMH Capital in Houston.
The dollar was down against a basket of major currencies,
with the U.S. Dollar Index <.DXY> down 0.33 percent at 76.322.
The euro <EUR=> was up 0.22 percent at $1.4653, and against
the yen, the dollar <JPY=> was down 0.52 percent at 88.59 yen.
U.S. gold futures for February delivery <GCG0> in New York
finished $3.90 higher at $1,123.80 an ounce.
" The dollar decline helped stem the selling pressure. But
the jury is still out on where the next near-term move will be
for gold. For now, it's nap time," said George Nickas, a metals
broker at FC Stone in New York.
European shares rose for a third straight session to hit a
one-week closing high, with regional financial shares advancing
after Dubai said it had received funding to help repay $4.1
billion in an Islamic bond maturing on Monday. []
In Europe, the FTSEurofirst 300 <> index of top
regional shares ended 0.8 percent higher at 1,018.29.
The inter-bank cost of borrowing dollars and euros held
near record lows as the market prepared for the Fed's statement
on interest rates and the final chance to get cheap one-year
money from the European Central Bank. []
The MSCI index of Asia Pacific stocks outside Japan
<.MIAPJ0000PUS> reversed course following the Dubai
announcement to gain 0.4 percent. In Tokyo, Nikkei average
<> erased earlier losses to end flat.
(Reporting by Angela Moon, Edward McAllister, Steven C.
Johnson, Emily Flitter and Carole Vaporean in New York and
Kirsten Donovan, Michael Taylor in London; Writing by Herbert
Lash; Editing by James Dalgleish; Editing by Andrew Hay)
