new yorklondon sept 23 reuters  world stock markets rallied on thursday and the us dollar retreated from onemonth highs as risk appetite heated up as investors digested the federal reserves plans for reining in stimulus and worries about contagion from china evegrande calmed wall streets sp 500 surged over 1 in early trade following solid gains in europe mscis gauge of stocks across the globe miwd00000pus rose 1 with the index recovering all its losses from monday when it posted its biggest percentage drop in two months safehaven trades faded after benefiting earlier in the week with gold prices dropping “we are seeing markets rally on the premise that while the situation in china particularly with evergrande is not going away the outcome is not perhaps going to be as severe or prompt some form of contagion that was originally feared” said craig fehr investment strategist at edward jones you combine that with the fact that the tone that the fed struck yesterday at its meeting suggests that while a reduction in stimulus is certainly coming the fed is not particularly eager to start tightening policy dramatically in the near term the fed on wednesday said it will likely begin reducing its monthly bond purchases as soon as november and signalled interest rate increases may follow more quickly than expected as the us central banks turn from pandemic crisis policies gains momentum read more in hong kong shares of debtladen property group evergrande 3333hk jumped 18 ahead of a key debt payment deadline fears the groups distress could spill into the broad economy helped spark an equity selloff to start the week read more on wall street the dow jones industrial average dji rose 44997 points or 131 to 3470829 the sp 500 spx gained 5301 points or 121 to 444865 and the nasdaq composite ixic added 14744 points or 099 to 1504428 norways central bank raised its benchmark interest rate and said it expects to hike again in december joining a short but growing list of nations moving away from emergencylevel borrowing costs norways crown strengthened to its highest level since midjune versus the euro read more in other currency trading the dollar index fell 0506 after hitting a onemonth high earlier with the euro up 049 to 11743 the japanese yen weakened 026 versus the greenback to 11007 per dollar benchmark us 10year notes last fell 1032 in price to yield 13652 from 1331 late on wednesday oil prices rose supported by growing fuel demand and a draw in us crude inventories as production remained hampered in the gulf of mexico after two hurricanes read more us crude rose 114 to 7305 per barrel and brent was at 7680 up 08 on the day additional reporting by sujata rao in london and alun john in hong kong editing by hugh lawson alex richardson and steve orlofsky