* U.S. stocks higher in early trading
* Euro falls on euro zone outlook
* U.S. jobs data due on Friday
* IMF urges accommodative policy
(Updates with U.S. market opening, changes dateline; previous
LONDON)
By Caroline Valetkevitch
NEW YORK, Sept 3 (Reuters) - The euro fell on Thursday on a
darkening euro zone outlook, while global stock markets rallied
as the European Central Bank chief pledged to beef up or prolong
the bank's economic stimulus if necessary.
Oil prices also rose, following the rally in equities.
ECB President Mario Draghi's comments on the bank's
bond-buying program came as the ECB cut its inflation and growth
forecasts for the euro zone, although he said no one on the
bank's Governing Council had argued to add to the program now.
That helped to calm some jitters after weeks of market
turmoil as investors gauge whether global monetary policy will
be kept loose as central banks try to mitigate the recent market
turmoil stemming from growing worries about China's economy.
"I think the market is trying to calm down a little bit,
with the fear factor reducing somewhat and the data points to a
growing U.S. economy," said Peter Cardillo, chief market
economist at Rockwell Global Capital in New York.
Friday brings the monthly U.S. jobs report, a key element
in the Federal Reserve's decision on when to raise interest
rates for the first time in nearly a decade.
The Fed, which meets on Sept. 16-17, has said it will raise
rates when it sees sustained economic recovery. While the labor
market has strengthened, inflation remains below the Fed's 2
percent target.
With China's stock markets, the root of much of the global
volatility in recent weeks, closed on Thursday, European
equities markets took the lead.
The FTSEuroFirst .FTEU3 leading index of 300 shares was up
2.8 percent, while Germany's DAX shot up 3.2 percent .GDAXI .
The Dow Jones industrial average .DJI rose 177.55 points,
or 1.09 percent, at 16,528.93. The Standard & Poor's 500 Index
.SPX was up 23.56 points, or 1.21 percent, at 1,972.42. The
Nasdaq Composite Index .IXIC was up 44.63 points, or 0.94
percent, at 4,794.60.
EURO FALLS
The euro fell, surrendering most of the solid gains put up
against the dollar since China devalued the yuan last month,
after the ECB outlook.
Against the dollar, the euro touched a two-week low
of $1.1108 during Draghi's news conference and was last off 0.70
percent at $1.1148.
It was as high as $1.1332 earlier this week as investors
spooked by the market turmoil in China moved heavily into the
euro and yen.
U.S. Treasuries prices rose after the dovish outlook from
the ECB made U.S. government debt more attractive than European
counterparts. But caution ahead of Friday's monthly U.S.
employment report limited gains.
Benchmark 10-year Treasury notes US10YT=RR were last up
3/32 in price to yield 2.18 percent.
In the energy market, Brent LCOc1 was up $1.38 at $51.88 a
barrel, while U.S. crude CLc1 rose $1.45 to $47.70 a barrel.