Global stock indexes rose while the dollar held steady yesterday as investors turned their focus to the US Federal Reserve’s expected interest rate hike this week and potential changes in its inflation and growth outlook.

The S&P 500 and Dow Jones industrial average hit fresh record highs in early US trading, and the Dow was less than 1 per cent away from hitting the 20,000 mark for the first time.

The gains extended the market’s post US-election move up that has been driven largely by hopes of better US economic growth under President-elect Donald Trump.

Yet uncertainty over whether the Fed would signal a slow or fast pace of rate increases following its meeting kept the dollar steady against a basket of currencies.

The Dow Jones industrial average was up 67.55 points, or 0.34 per cent, to 19,863.98, the S&P 500 had gained 10.36 points, or 0.459025 per cent, to 2,267.32 and the Nasdaq Composite had added 55.41 points, or 1.02 per cent, to 5,467.95.

In Europe, stocks were helped by gains in banks after Italy’s largest lender unveiled a €13 billion share issue.

UniCredit launched Italy’s biggest share issue to clean up its balance sheet and boost profitability, the latest move to strengthen the Italian banking sector, which has been clouding the outlook for European stocks.

MSCI’s all-country world stock index was up 0.7 per cent, the pan-European STOXX 600 share index gained 1.1 per cent.

The US dollar index was last down 0.06 per cent at 100.970. The dollar was up 0.23 per cent against the yen at 115.29 yen after hitting a 10-month high of 116.12 yen on Monday.

In the US bond market, the US 10-year note prices were up 1/32, while the yield fell to 2.473 per cent from 2.479 per cent late on Monday. Earlier on Monday, the yield hit 2.528 per cent, its highest level since September 29, 2014, according to Reuters data.

Oil prices dipped, a day after surging to an 18-month high on Monday after the world’s top crude producers agreed to the first joint output cut since 2001.