Stocks extend rally, S&P hits new high as data signals growth

NEW YORK, Aug 21 (Reuters) - - Global equity markets edged higher on Thursday, with the S&P 500 hitting an all-time high, as U.S. and German data drove confidence on economic growth and helped extend a stock rally.

The data on German private-sector growth reassured investors about the outlook for Europe's biggest economy following a soft patch, while a batch of U.S. reports showed economic strength early in the third quarter.

Markit's flash composite Purchasing Managers' Index for Germany was 54.9 for August, well above the 50 mark that indicates economic expansion, a relief after GDP data last week showed Germany suffered a surprise contraction in the second quarter.

In the United States, home resales rose to a 10-month high in July, factory activity in the mid-Atlantic region hit its highest level since March 2011 in August, and a gauge of future economic activity grew solidly last month.

The benchmark S&P 500 rose as high as 1,992.65 points, topping the prior record of 1,991.39 set in late July, and European markets extended earlier gains. MSCI's measure of global equity performance .MIWD0000PUS also rose, but its measure of emerging markets .MSCIEF slipped a bit.

"It seems that conditions reflect the best of all worlds - U.S. economic growth that is neither too slow, which would put pressure on earnings, nor too fast," said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management in Minneapolis.

The Dow Jones industrial average .DJI rose 80.1 points, or 0.47 percent, to 17,059.23. The S&P 500 .SPX gained 5.63 points, or 0.28 percent, to 1,992.14, and the Nasdaq Composite .IXIC added 0.31 points, or 0.01 percent, to 4,526.79.

In Europe, the FTSEurofirst 300 .FTEU3 index of top regional shares rose 0.68 percent at 1,355.16 points.

The German data helped the euro EUR= rebound against the dollar, rising 0.2 percent to $1.3284. Against the yen, the dollar gained 0.04 percent to 103.77 yen.

U.S. Treasuries hewed to a tight range, showing little reaction to the stronger-than-expected U.S. economic data. Investors awaited developments from the annual meeting of central bankers in Jackson Hole, Wyoming, that begins later on Thursday.

A speech on Friday by Federal Reserve Chair Janet Yellen, when she is expected talk about labor markets, is highly anticipated by investors.

"We have fairly light volumes. People are looking ahead to Yellen," Justin Lederer, an interest rate strategist with Cantor Fitzgerald in New York.

Benchmark 10-year U.S. Treasuries US10YT=RR were up 1/32 in price to yield 2.4228 percent.

Brent crude oil fell below $102 a barrel, near a 14-month low, on plentiful fuel supplies and as Chinese data pointed to slowing demand, but prices rose in U.S. trading.

Brent crude LCOc1 for October dropped 33 cents to $101.95 a barrel, while U.S. crude CLc1 rose 59 cents to $94.04 a barrel.

(Reporting by Herbert Lash; Additional reporting by Marc Jones in London; Editing by Leslie Adler)

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