By Rodrigo Campos
NEW YORK (Reuters) - Stocks on Wall Street rose while other major markets edged lower on Monday as investors bet the Federal Reserve will raise interest rates sooner than previously expected, while U.S. and euro zone bond prices rose as the European Central Bank started its bond-buying programme.
Brent crude prices fell, with traders citing uncertainty after U.S. President Barack Obama issued an executive order declaring OPEC member Venezuela a national security threat. Oil stockpiles also weighed.
Deal news and share buybacks buoyed Wall Street after two consecutive weekly losses, with the S&P 500 about 2 percent below its record high set last week.
A larger pullback is still likely on Wall Street according to a Monday note from Brian Reynolds, chief market strategist at Rosenblatt Securities in New York.
"Given the intensity of the selling (last week) we now think it is more likely that it bottoms out in the 2,000-2,050 area," Reynolds wrote about the S&P 500's near-term outlook.
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European shares ended lower as traders booked recent gains that came on bets the ECB's bond purchases programme, aimed at reviving inflation and economic growth, will lift equities. European and Asian stocks were also pressured by Friday's forecast-beating U.S. jobs data, which stoked expectations the Fed would bring closer the timing of a rate hike. The data showed wage inflation pressures, however, were muted.
The Dow Jones industrial average rose 126.19 points, or 0.71 percent, to 17,982.97, the S&P 500 gained 6.93 points, or 0.33 percent, to 2,078.19 and the Nasdaq Composite added 4.25 points, or 0.09 percent, to 4,931.62.
The pan-European FTSEurofirst 300 index ended down 0.26 percent and Tokyo's Nikkei <.N225> closed 0.95 percent lower. An MSCI gauge of stocks in major markets fell 0.15 percent.
German 10-year yields , the euro zone benchmark, fell 9 basis points to 0.31 percent. The U.S. benchmark 10-year Treasury note rose 8/32 in price to yield 2.211 percent. The 30-year bond rose 17/32, its yield at 2.8117 percent.
The U.S. dollar was little changed against a basket of currencies after hitting an 11-1/2-year high.
The euro hit its lowest against the U.S. currency since September 2003 at $1.0821 before edging up to $1.0848. The euro has been pressured by the divergent monetary policies of the Fed and the ECB.
"We seem to be taking a breather here, consolidating gains made off the nice jobs report. It is going to take something else to get us back down below the $1.0760 range, but we're not too sure what that immediate catalyst will be, given the economic calendar is light this week," said John Doyle, director of markets at Washington, D.C.-based Tempus Inc.
Brent crude oil fell 1.1 percent to $59.06 a barrel while U.S crude rose 1.4 percent to $50.31 a barrel. Gold edged higher to $1,168 an ounce, just above a three-month low.
Copper jumped 2.1 percent after closing on Friday with its largest weekly drop since January.
(Additional reporting by Daniel Bases and Barani Krishnan; Editing by Meredith Mazzilli and Chris Reese)