GLOBAL MARKETS-Stocks, oil rise; demand for risky assets up

* MSCI (NYSE: MSCI - news) global stocks index hits highest since December

* Oil rises, lifting investor appetite for risky assets

* Commodity currencies up vs U.S (Other OTC: UBGXF - news) . dollar (Updates with U.S. market openings, changes dateline)

By Caroline Valetkevitch

NEW YORK, April 19 (Reuters) - Major world stock markets rose on Tuesday as the bounce in oil prices helped the energy sector, following signs of economic stabilization in China, increasing demand for riskier assets.

The rise in oil prices, largely driven by a workers' strike that nearly halved output from Kuwait, drove the Australian dollar to a 10-month high and boosted the currencies of other countries dependant on commodities. Copper prices also were up 2.1 percent.

The Dow Jones Industrial Average and S&P 500 stock index climbed in morning trading, keeping the Dow above 18,000 and putting the S&P 500 less than 30 points from its May 2015 all-time closing high.

The Dow Jones industrial average was up 0.44 percent to 18,082.78, the S&P 500 gained 0.42 percent to 2,103.08 and the Nasdaq Composite fell 0.1 percent, to 4,954.88 by late morning in New York.

MSCI's All Countries World Index, which tracks shares in 45 countries, was up 1.0 percent late morning i New York and hit its highest level since December, while European stocks jumped 1.4 percent. Stocks in Japan and China also ended higher.

"The predominant theme is risk on," said Richard Scalone, co-head of foreign exchange at TJM Brokerage in Chicago.

"We came into the year concerned about Chinese growth and an aggressive (Federal Reserve), and we've gotten nothing even remotely similar to where our fears were."

The rise in crude oil prices from below $30 a barrel seen in February, and signs of steady economic growth in China recently, along with the U.S. Federal Reserve's cautious approach to raising interest rates, are all factors supporting stock prices in recent weeks.

Brent crude oil traded at $44.22 per barrel at midsession, up $1.31, while U.S. crude oil was up $1.41 at $41.19.

The workers' strike in Kuwait cut production to 1.1 million barrels per day from 2.8 million in March and overshadowed the weekend failure by oil producers meeting in Doha to agree to freeze output. However, an official of the Kuwaiti state refiner said output would be restored in coming days.

The U.S. dollar hit 10-month lows against some commodity-related currencies and touched a nearly one-week low against the euro after weak U.S. housing data reinforced views of a dovish Fed.

U.S. housing starts fell more than expected in March and permits for future home construction hit a one-year low.

The Australian dollar hit $0.7817, its highest level against the U.S. dollar since last June, while the New (KOSDAQ: 160550.KQ - news) Zealand dollar touched $0.7055, also its highest since last June on the back of gains in oil prices. The Canadian dollar also rallied.

Brazil's currency, the real, gained 1.9 percent against the dollar. The real had weakened on Monday after the central bank intervened to prevent it rising sharply following a Congressional vote to impeach President Dilma Rousseff, a move which may result in a more market-friendly government.

Gold (Other OTC: GDCWF - news) rose as the dollar weakened, with gold touched a one-week high of $1,256.80 an ounce. (Additional reporting by Sam Forgione in New York; Nigel Stephenson in London; Lisa Twaronite in Tokyo, Anirban Nag, John Geddie and Atul Prakash in London; Editing by Larry King and Clive McKeef)