GLOBAL MARKETS-Oil gains, U.S. stocks hit highs as investors await Fed

Brent crude oil's rise back above $50 a barrel helped lift stocks on global markets on Wednesday, while upbeat earnings and economic data soothed worries the world economy may be headed for another slowdown.

All three major U.S. stock indexes hit record highs in early New York trading as Boeing and AT&T led another set of strong earnings reports from U.S. companies.

A U.S. dollar index gained slightly and U.S. Treasury prices were nearly flat as investors waited on the Federal Reserve's statement from its two-day meeting to see if the U.S. central bank gives any new indications about when it will begin paring its bond holdings and next raise interest rates.

Many analysts and investors expect the Fed to say at its September meeting it will begin reducing its bond portfolio, but they will be watching for any hints on the timing at this week's meeting. Further Fed rate hikes are not seen as likely until at least December.

"Any change or confirmation from the Fed statement could make that a market mover this afternoon," said Bucky Hellwig, senior vice president at BB&T Wealth Management in Birmingham, Alabama.

But this morning "there are a lot of bullish things across the different markets," he said. "Strong earnings reports really boosted the Dow. Oil is up ... The dollar hit the bottom of its two-year range so it looked like it was due for a bounce."

Oil prices rose to near eight-week highs, with Brent futures trading over $50 a barrel after data showing a fall in U.S. inventories.

Brent futures were up 74 cents to $50.94, while U.S. West Texas Intermediate futures climbed 80 cents to $48.69.

The S&P 500 energy index was up nearly 1.2 percent and among the day's top performing sectors.

The Dow Jones Industrial Average was up 105.61 points, or 0.49 percent, to 21,719.04, the S&P 500 had gained 1.87 points, or 0.08 percent, to 2,479 and the Nasdaq Composite had added 7.78 points, or 0.12 percent, to 6,419.96.

MSCI's index of stock markets across the world was up 0.13 percent, while European shares rose 0.45 percent.

The dollar, hurt since March by a retreat in expectations for further rises in U.S. interest rates this year, gained 0.1 percent against both the euro and the euro-dominated basket of currencies most used to measure its broader strength.

Benchmark 10-year U.S. Treasury notes dipped 2/32 in price to yield 2.33 percent, unchanged from Tuesday.

For Reuters Live Markets blog on European and UK stock markets see reuters://realtime/verb=Open/url=http://emea1.apps.cp.extranet.thomsonreuters.biz/cms/?pageId=livemarkets

(This article has not been edited by DNA's editorial team and is auto-generated from an agency feed.)