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Euro surges after ECB meeting, world stocks keep climbing

By Lewis Krauskopf

NEW YORK (Reuters) - The euro surged to approach a two-year high against the U.S. dollar on Thursday after Europe's central bank chief said officials would discuss possible changes to its bond-buying scheme this autumn, while world equity markets headed for a 10th day of gains.

Though European Central Bank President Mario Draghi set no date for changes to the bond-buying plan and that officials were unanimous in their decision not to change their guidance on monetary policy, investors suspected the talks would lead to tightening next year.

The euro <EUR=> was up 0.96 percent to $1.1624, and poised for its biggest single-day percentage gain in more than three weeks.

"The marketplace is looking for a good potential for (ECB quantitative easing) reduction to start in September or at least to be announced in September," said Richard Scalone, co-head of foreign exchange at TJM Brokerage in Chicago.

In equities, the pan-European FTSEurofirst 300 index <.FTEU3> lost 0.31 percent, while Wall Street's main stock indexes treaded water around record high levels.

Still, MSCI's gauge of stocks across the globe <.MIWD00000PUS> gained 0.25 percent, putting it on track for its longest streak of gains since February 2015, as a cautious-sounding Bank of Japan sent Asian markets to their highest in almost a decade overnight.

On Wall Street, the Dow Jones Industrial Average <.DJI> fell 20.59 points, or 0.1 percent, to 21,620.16, the S&P 500 <.SPX> gained 1.59 points, or 0.06 percent, to 2,475.42 and the Nasdaq Composite <.IXIC> added 3.55 points, or 0.06 percent, to 6,388.59.

With second-quarter reporting season in full swing, Qualcomm <QCOM.O> shares fell 5.1 percent after the chipmaker's forecast missed estimates.

The number of Americans filing for unemployment benefits fell more than expected last week, touching its lowest level in nearly five months, suggesting strong job gains that should continue to underpin economic growth.

While suffering against the euro, the dollar also weakened overall against a basket of major currencies. The dollar index <.DXY> fell 0.53 percent, touching an 11-month low.

U.S. Treasury yields declined, with benchmark yields hitting three-week lows as the ECB maintained its pledge of easy money with inflation stuck below its 2-percent target despite improved growth in the region.

Benchmark 10-year notes <US10YT=RR> last rose 4/32 in price to yield 2.2536 percent, from 2.268 percent late on Wednesday.

"Inflation is the main concern right now. Until something changes, it will rule the world," said Thomas Roth, head of U.S. Treasury trading at MUFG Securities America in New York.

Oil prices dipped in choppy U.S. trading, as nagging worries about abundant global crude supplies dragged prices lower. An early rally had pushed Brent above $50 per barrel for the first time since early June.

U.S. crude <CLcv1> fell 0.4 percent to $46.93 per barrel and Brent <LCOcv1> was last at $49.47, down 0.46 percent on the day.

Spot gold <XAU=> added 0.4 percent to $1,245.51 an ounce.

(Additional reporting by Sam Forgione and Richard Leong in New York, Marc Jones, Patrick Graham and John Geddie in London; Editing by Bernadette Baum)