NEW YORK: A global equity index surged to a record high and the dollar gained on Monday, spurred by relief that Hurricane Irma weakened to a tropical storm and that North Korea's anniversary celebrations on the weekend passed without a new missile test.
Gold prices fell as did the price of benchmark German and U.S. Treasury debt as demand slipped for safe-haven assets and investors took on more risk after North Korea marked its founding on Saturday without new provocations.
Ranked as one of the most powerful hurricanes ever recorded in the Atlantic, Irma hit a wide swath of Florida on Sunday before being downgraded to a tropical storm. While heavy flooding swamped Miami and other cities, the state's largest city was spared the brunt of the storm.
"For now, we're seeing a bit of a relief rally. It does appear that the worst-case scenario for Florida has been evaded," said Peter Cardillo, chief market economist at First Standard Financial in New York.
MSCI's all country world stock index, which tracks 2,400 stocks in 47 countries, climbed to its latest peak as Europe's insurers rose more than 2 percent on hopes Irma's damage would not prove as costly as feared.
Shares on Wall Street jumped about 1 percent, with the benchmark S&P 500 index less than half a percentage point away from record territory.
The Dow Jones Industrial Average rose 215.95 points, or 0.99 percent, to 22,013.74, the S&P 500 gained 20.28 points, or 0.82 percent, to 2,481.71 and the Nasdaq Composite added 55.65 points, or 0.87 percent, to 6,415.84.
The pan-European FTSEurofirst 300 index rose 0.98 percent and MSCI's gauge of global stocks gained 0.74 percent.
The relief over North Korea and a weaker yen helped give the stock market in Tokyo its best session since June.
Investors are so focused on the hurricane's fallout and the Federal Reserve's potential tightening that they're missing the enormous boost the weaker dollar and low interest rates will give the U.S. economy, said Jim Paulsen, chief investment strategist at the Leuthold Group in Minneapolis.
"We are massively stimulating this economy that's already doing pretty well," Paulsen said. "That's likely to accelerate an already-good economy even further the next 12 months."
The dollar index, which tracks the greenback against a basket of six major currencies, was 0.38 percent higher at 91.697.
The index had hit a more than 2-1/2-year low of 91.011 on Friday as investors fretted about the short-term impact of Irma on the U.S. economy and simmering tensions with North Korea.
The euro fell 0.48 percent to $1.1975 against the greenback, while the Japanese yen weakened 1.07 percent at 108.99 per dollar.
Germany's benchmark 10-year bond yield pulled further away from recent 2-1/2 month lows and yields on benchmark U.S. Treasury debt rose from 10-month lows.
The 10-year U.S. Treasury note last fell 17/32 in price to yield 2.1201 percent, up from 2.061 percent late on Friday.
German Bunds last fell 1 basis point in price to yield 0.334 percent.
Oil prices fell on concerns that Irma's pounding of Florida could dent oil demand in the world's top oil-consuming nation.
Losses were capped by weekend talks between Saudi Arabia's energy minister and counterparts over a possible extension to a pact to cut global oil supplies beyond next March.
Brent crude oil futures for November delivery were down 66 cents at $53.12 a barrel, while benchmark U.S. West Texas Intermediate crude declined by 33 cents to $47.15.
Spot gold dropped 1.0 percent to $1,332.80 an ounce. U.S. gold futures fell 1.04 percent to $1,337.20 an ounce.