GLOBAL MARKETS-Euro rises on talk ECB rate cut unlikely, stocks gain

* Euro regains footing, but ECB under pressure to boost

stimulus

* Wall St gains on expectations Fed to keep rates at near

zero

* European shares inch up to new 5-year highs

* Oil rises to $106/bbl, lifted by Libya, product supply

drops

By Herbert Lash

NEW YORK, Nov 6 (Reuters) - Global stock markets rose on

Wednesday and the Dow industrials hit a record intraday high on

strong German data and talk the Federal Reserve may keep rates

low longer than expected, while speculation that the European

Central Bank won't cut rates this week lifted the euro.

Stronger-than-expected German industry orders affirmed

expectations the ECB would keep rates unchanged on Thursday

despite a steep fall in inflation, helping push the euro up 0.3

percent to $1.3518..

Surveys that showed only modest growth in German and French

businesses, however, were likely to cap euro gains, traders

said, and would probably convince the ECB to maintain a dovish

tone at Thursday's monetary policy meeting.

Wall Street rose after John Williams, president of the San

Francisco Federal Reserve Bank, said late on Tuesday the Fed

should wait for stronger evidence of economic growth before

winding down its massive bond-buying program.

Two of the Fed's top staff economists made the case in new

research papers for more aggressive action by the U.S. central

bank to drive down unemployment by promising to hold interest

rates lower for longer.

The notion of lower interest rates for longer helped lift

the Dow industrials to a record intraday high, while a Reuters

report that Microsoft (Berlin: MSF.BE - news) had narrowed its CEO search

lifted shares in the tech giant and buoyed the S&P 500 index.

"What's seeping into the market is the increasing likelihood

(the Fed) will keep zero percent interest rates for 18 months

longer than they had signaled previously," said Steven Einhorn,

vice chairman at hedge fund Omega Advisors Inc., which oversees

about $9.7 billion in assets.

The Fed has concluded that its bond-buying is no longer that

effective, and the size of its balance sheet is getting to be

problematic, Einhorn said.

All three major U.S. stock indexes initially rose, but the

Nasdaq later retreated, with a 15.4 percent decline in shares of

Tesla Motors Inc (Xetra: A1CX3T - news) the biggest drag after it reported

weaker-than-expected earnings late Tuesday.

The Dow Jones industrial average was up 102.01

points, or 0.65 percent, at 15,720.23. The Standard & Poor's 500

Index was up 6.21 points, or 0.35 percent, at 1,769.18.

The Nasdaq Composite Index was down 9.00 points, or 0.23

percent, at 3,930.86.

In Europe, the FTSEurofirst 300 of leading regional

shares rose 0.39 percent to close at 1,296.58, after briefly

touching 1,300 for the first-time since early June 2008.

MSCI (NYSE: MSCI - news) 's all-country world stock index rose

0.4 percent.

Estimate-beating earnings from financial conglomerate ING

and staffing firm Adecco (VTX: ADEN.VX - news) , among other

corporate results, gave fresh impetus to the largely

stimulus-driven rally.

U.S. government debt traded mixed. The benchmark 10-year

U.S. Treasury note was up 6/32 in price to yield

2.64 percent, while the 30-year bond was down.

Brent oil settled down 9 cents at $105.24 a barrel, while

U.S. oil $1.52 to $94.89 per barrel.

Data from the Energy Information Administration (EIA) showed

U.S. gasoline stocks had fallen by 3.8 million barrels last

week, compared with forecasts in a Reuters poll for a 300,000

barrel decline.