GLOBAL MARKETS-World stocks gain ahead of 'formidable' week for risk; oil prices ease

By Chris Prentice and Amanda Cooper

NEW YORK/LONDON, Oct 26 (Reuters) - Global shares and bond prices rose on Monday, with investors focused on a week of central bank meetings and corporate earnings that will test confidence in the AI boom.

Oil prices eased from six-month highs, with persistent attacks on key producer Saudi Arabia keeping traders wary.

The Houthi group in Yemen said on Monday it had attacked Saudi Arabia's East-West crude oil pumping stations and Riyadh airport, but there was no immediate confirmation from Riyadh.

MSCI's All-World index .MIWD00000PUS gained 0.6% to 1,125.67, after dropping 1% last week.

On Wall Street, shares opened higher with Anthropic's initial public offering filing in focus. The Dow Jones Industrial Average .DJI rose 0.52% to 52,488.30, the S&P 500 .SPX gained 0.96% to 7,696.94 and the Nasdaq Composite .IXIC added 1.23% to 26,275.27.

Brazil's stock exchange halted trading via a circuit breaker safety mechanism on Monday after President Luiz Inacio Lula da Silva's reelection. His opponent refused to concede.

In Europe, the STOXX 600 .STOXX was up 0.8% amid gains in energy-sensitive stocks such as industrials.

BIG WEEK

Volatility was contained, considering this week's macroeconomic risk in the form of multiple central bank meetings and earnings from AI hyperscalers.

Earnings are in store from Alphabet GOOGL.O, Microsoft MSFT.O and Amazon AMZN.O, as one-third of S&P 500 companies report.

"The combination is formidable: megacap earnings, AI funding concerns, global semiconductor results, five major central bank meetings and potentially market-moving inflation and growth data," said Chris Weston, Pepperstone's head of research.

"The danger isn't simply that markets move sharply. It's that one catalyst changes the interpretation of the next, creating feedback loops across equities, rates, FX and volatility," he added.

New Zealand's central bank is widely expected to raise rates on Wednesday. Markets assume the US Federal Reserve will stand pat, but they imply an 80% chance that it will hike rates in December. Much the same is priced in for the Bank of Japan and the European Central Bank. , ,

A key reading on US core inflation should show cost pressures remained elevated at 3.1% in September, while the economy is forecast to have grown at a brisk 3.2% annualized pace thanks in part to spending on data centers.

"The most important risk is that oil futures are above our forecasts, largely reflecting concerns about potential further conflict with Iran," analysts at Goldman Sachs said in a note. "The more extreme and long-lasting the energy shock becomes, the more Fed participants will worry that inflationary pressures could broaden."

TREASURIES AND CURRENCIES

The Brazilian real plunged after the presidential election.

Yields on 10-year Treasuries fell 1 basis point to 4.968%. The yield on the benchmark German 10-year Bund was flat at 3.343%.

Treasury yields move inversely to prices.

In currency markets, the Japanese yen slipped 0.42%, while the euro was down 0.18% after France dodged a credit downgrade last week.

Sterling dipped 0.23% to $1.3344 , with Britain's new finance minister John Healey set to deliver his first budget on Wednesday amid rising global borrowing costs and high energy prices due to the US-Israeli war with Iran.

Spot gold rose 0.69% to $4,023.24 an ounce. GOL/

Saudi Arabia, which along with Turkey and Pakistan was set to hold talks with Iranian officials in Tehran, said it was important to open channels for negotiations.

On Sunday, Qatari mediators traveled to Tehran to try to de-escalate regional tensions in coordination with the United States, an official briefed on the situation said.

Brent crude futures fell to $115.10 per barrel, down 1.37%, and US crude lost 2.17% to $101.03.