Global stocks rise despite Greece; oil reverses, falls sharply

NEW YORK (Reuters) - Shares edged higher in major markets and Greek debt yields rallied on Monday after the parliament in Athens rejected the government's presidential candidate, while crude prices tumbled after a short-lived bounce.

Greece's Syriza party wants to wipe out a big part of the country's debt and cancel the terms of a bailout from the European Union and International Monetary Fund that Athens needs in order to pay its bills.

Greek Prime Minister Antonis Samaras failed to get enough support for his nominee and will call a national election for Jan. 25. Stocks in Athens <.ATG> plunged as much as 11.3 percent and yields on 10-year government bonds touched their highest since September 2013.

On Wall Street, however, the S&P 500 hit yet another intraday record high, boosted by gains in utilities, consumer and bank stocks.

"Greece is always worth paying attention to, but it?s a hiccup," said Mark Martiak, senior wealth strategist at Premier Wealth/First Allied Securities in New York. "I don?t see it as anything that makes a difference in the overall market."

On Wall Street, the Dow Jones industrial average <.DJI> was down 4.21 points, or 0.02 percent, at 18,049.50. The Standard & Poor's 500 Index <.SPX> was up 2.73 points, or 0.13 percent, at 2,091.50. The Nasdaq Composite Index <.IXIC> was up 4.24 points, or 0.09 percent, at 4,811.10.

The pan-European FTSEurofirst 300 index <.FTEU3> closed up 0.15 percent and an MSCI gauge of major equity markets <.MIWD00000PUS> edged up 0.2 percent.

Oil prices continued to fall after earlier rising on concern about Libyan output. Brent crude futures fell 2.8 percent to $57.77 per barrel after hitting a high of $60.43. U.S. crude lost 2.6 percent to $53.32 a barrel.

"Everyone's trying to put the issues in Libya into perspective," said Carl Larry, director of business development at Frost and Sullivan.

Hurt in part by the sharp decline in crude prices in the past six months, Russia's economy shrank sharply in November and the rouble resumed its slide. Western sanctions combined with lower oil to cause the first contraction in Russian GDP since the global financial crisis.

The rouble fell 8.8 percent to 58.70 per dollar.

The implications of the slide in oil on many of the larger producers that depend on crude revenues are a headwind for financial markets as the year end approaches.

U.S. Treasuries prices rose on safety buying after the Greek parliament vote, though trading was light as many investors are away the week between the Christmas and New Year's holidays. The benchmark 10-year U.S. Treasury note was up 8/32, its yield at 2.2198 percent.

"That is one of the main reasons we are trading a bit better here ... there is more of a 'risk off' feel, given the headlines out of Greece," said Sean Murphy, a Treasuries trader at Societe Generale in New York.

The euro was unchanged against the greenback at $1.2175 . It was not far from last week's $1.2164, which was the lowest going back to early August 2012.

Greece?s failure to elect a new president, and the resulting risk to its bailout program, ?has largely been already reflected in the market positioning," said Douglas Borthwick, managing director at Chapdelaine Foreign Exchange in New York.

The dollar strengthened marginally against the yen at 120.57 but lacked momentum to challenge a 7-1/2 year high of 121.84 hit earlier this month.

(Additional reporting by Ryan Vlastelica, Karen Brettell, Sam Forgione and Samantha Sunne; Editing by Dan Grebler)

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