(Adds close of European markets, oil settlement)
* Wall St slightly higher after FOMC minutes
* Oil retreats after OPEC reports output at 8-year high
* Dollar gains on Fed minutes speculation
By Herbert Lash
NEW YORK, Oct 12 Global equity markets remained
slightly lower and the dollar a bit higher on Wednesday after
minutes from a meeting of Federal Reserve policymakers last
month indicated raising U.S. interest rates was warranted if the
economy continued to strengthen.
Market reaction was muted as there was little revelatory in
the minutes from the Sept. 20-21 meeting, with policymakers
divided on how much longer they should allow the labor market
and inflation to improve before lifting rates.
Oil prices fell more than 1 percent after the Organization
of the Petroleum Exporting Countries reported its output hit an
eight-year high in September, offsetting optimism over the
group's pledge to bring a global crude glut under control.
Sterling rebounded from a brutal selloff since last week as
British Prime Minister Theresa May's offer to give UK lawmakers
a say in plans to leave the European Union calmed fears of a
"hard Brexit" marking a clear break from the single market.
U.S. equity markets rose before the release of the Federal
Open Market Committee's minutes, while European markets and an
index of global equity performance traded lower.
"We remain where we were: a market still betting Chair
Yellen wants a hike in December," said Quincy Krosby, market
strategist at Prudential Financial.
The Dow Jones industrial average rose 39.86 points,
or 0.22 percent, to 18,168.52. The S&P 500 gained 5.41
points, or 0.25 percent, to 2,142.14 and the Nasdaq Composite
added 0.78 points, or 0.01 percent, to 5,247.57.
In Europe, the FTSEurofirst 300 index of leading
regional companies closed down 0.45 percent to 1,336.17. MSCI's
all-country world equity index fell 0.21 percent.
The dollar index, which measures the greenback against a
basket of six major trading currencies, hit a seven-month high
at 98.043 ahead of the FOMC minutes.
"A December increase is still likely, perhaps for no better
reason than to save face for the FOMC members," said Chris
Gaffney, president of world markets at EverBank.
However, Gaffney said that recent economic data does not
indicate the case for raising rates has strengthened.
The euro hit an 11-week low of $1.1005 in early U.S.
trading, and was last down 0.35 percent at $1.1014. The dollar
was last up 0.71 percent against the yen at 104.23 yen.
U.S. Treasury yields rose to their highest levels in four
months, with prices pressured by two auctions and growing
expectations of a Fed rate hike this year.
Yields on shorter-dated maturities, such as 2-year
notes, which are more sensitive to Fed policy
expectations, rose to their highest since early June ahead of
the Fed minutes. Two-year notes fell 1/32 in price to yield
Benchmark 10-year Treasury notes were last down
6/32 in price to yield 1.7798 percent, with yields earlier
rising above 1.80 percent for the first time since June 3.
Brent crude fell 60 cents to settle at $51.81 a
barrel, while U.S. West Texas Intermediate crude slipped
61 cents to settle at $50.18 a barrel.
(Reporting by Herbert Lash, additional reporting by Sam
Forgione and Dion Rabouin in New York; Editing by Meredith