Shares gain on stimulus hopes; Spain caps rise
NEW YORK (Reuters) - Stocks edged higher around the world on Tuesday, with U.S. markets in particular buoyed by end-of-quarter buying by funds and a higher-than-expected reading of confidence among American consumers.
However, lingering concerns over Spain's funding problems and renewed worries about global growth limited gains.
U.S. stocks rose at the open after comments late on Monday from the president of the San Francisco Fed suggested the central bank was not done taking action to stimulate the economy.
But a pessimistic outlook from Caterpillar (CAT.N: Quote) capped gains and some investors cautioned the advance may be due to window-dressing for the end of the quarter. .N
U.S. stocks were supported by a private sector report showing U.S. consumer confidence jumped to its highest level in seven months in September as Americans were more optimistic about the job market and income prospects.
The MSCI world equity index .MIWD00000PUS rose 0.4 percent to 337.48. European shares .FTEU3 also gained 0.4 percent.
"A lot of people are buying equities today because they've been underexposed to the market. It isn't necessarily a call on fundamentals," said Nicholas Colas, chief market strategist at the ConvergEx Group in New York.
"Money managers who haven't believed in the rally don't want to compound that error by showing a lack of exposure at the end of the quarter."
The Dow Jones industrial average .DJI was up 26.41 points, or 0.19 percent, at 13,585.33. The Standard & Poor's 500 Index .SPX was up 2.58 points, or 0.18 percent, at 1,459.47. The Nasdaq Composite Index .IXIC was up 7.12 points, or 0.23 percent, at 3,167.90. Continued...