World stocks, dollar see steep rise on Yellen, US outlook

World stocks hit 21-month peaks on Feb. 15 and the dollar rose for the 11th straight day, after Federal Reserve Chair Janet Yellen flagged a possible interest rate rise next month during upbeat comments on the U.S. economy.

The dollar notched up its longest winning streak in almost five years after Yellen said on Feb. 14 the Fed would probably need to raise rates at an upcoming meeting and that delaying could leave the central bank's policymaking committee behind the curve.

Propelled by record highs on Wall Street, MSCI's benchmark global equity index rose 0.25 percent to 442.4 points , its highest since May 2015 and two points off its record high. It has not fallen for six sessions, its longest such run since last July.

Europe's index of leading 300 stocks rose 0.4 percent to 1,465 points, its highest since December 2015. Germany's DAX and Britain's FTSE were both up 0.5 percent.

"At the margin, you could say that her (Yellen's) comments were probably tilted slightly towards to the hawkish side given her upbeat comments around the economic outlook," said Jim Reid, markets strategist at Deutsche Bank.

Yellen's remarks helped push Wall Street by boosting U.S. bank stocks. Goldman Sachs shares hit a record high, and are up 37 percent since the U.S. presidential election on Nov. 8.

Financials also led the way in Europe, with Credit Agricole up more than 3 percent after France's biggest retail bank beat forecasts with a smaller than expected earnings drop in the fourth quarter.

MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.7 percent, rising to its highest since July 2015. Japan's Nikkei added more than 1 percent, buoyed by a weaker yen.

Punchy dollar

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