GLOBAL MARKETS-Stocks, oil, dollar get lift from easy money
* Europe's central banks follow Fed in leaving policy unchanged
* Official Chinese data and euro zone PMIs point to growth
* Dollar rises from six-week low, euro dips
* S&P 500 climbs above 1,700 for the first time
NEW YORK, Aug 1 (Reuters) - Shares, the dollar and crude oil all rallied on Thursday, with the benchmark S&P 500 stock index climbing above 1,700 for the first time, as central banks in the euro zone and Britain joined the Federal Reserve in keeping their easy monetary policies intact.
The European Central Bank and the Bank of England both ended policy meetings by leaving interest rates at record lows, a day after the Fed said the U.S. economy still needed its support and avoided any mention of a change to its stimulus measures.
The promise of abundant liquidity came as data showed U.S. manufacturing picked up sharply, with one measure pointing to the highest growth in two years. The U.S. data arrived on the back of euro zone industrial activity picking up for the first time in two years, greater stability in China's factory sector and a surge in British production.
"Bottom line, it's still free money everywhere - whether it is in the U.S., the Bank of England, the ECB - they are all saying the same thing and everyone is kind of loving it," said Joe Saluzzi, co-manager of trading at Themis Trading in Chatham, New Jersey.
The Dow Jones industrial average was up 113.95 points, or 0.74 percent, at 15,613.49. The Standard & Poor's 500 Index was up 17.62 points, or 1.05 percent, at 1,703.35. The Nasdaq Composite Index was up 36.82 points, or 1.02 percent, at 3,663.20.
The better outlook encouraged investors back into riskier assets, lifting MSCI's world equity index 0.9 percent, and sending U.S. crude up 2.8 percent to $107.90 a barrel.
The dollar index, which tracks the greenback against a basket of major currencies, gained 1 percent to 82.302, though it was still not far from a six-week low touched on Wednesday after the Fed's policy announcement. The U.S. data caused a big jump in the dollar as investors took it as a sign of steady improvement in the U.S. economy.
Hopes are also rising that Friday's key July U.S. payrolls report will show another solid rise in employment.
However, traders said a strong report would increase the likelihood the Fed could begin scaling back its stimulus in September - a move that could hurt the gains in equities and commodities, although it would support the dollar.
"We're very much looking for the dollar to continue to gain support, given the heightened expectations for nonfarm payrolls, which are centred around the 200,000 mark," said Ian Stannard, head of European FX strategy at Morgan Stanley in London.
Employment outside the farming sector is seen up by 184,000 in July, according to economists polled by Reuters.
The euro slipped 0.6 percent to trade at $1.3217, off Wednesday's six-week high of $1.3344. The dollar rose 1.6 percent against the yen.
The encouraging Chinese manufacturing data, along with some strong corporate earnings and the central bank actions, combined to lift European shares 0.94 percent.
Earlier, after the improvement in China's official industrial activity survey eased concerns of a sharp slowdown in the world's second-largest economy, Japan's Nikkei jumped 2.5 percent for its biggest one-day gain in three weeks.
In fixed income markets, U.S. Treasuries prices extended losses after the ISM report. The benchmark 10-year Treasury note was down 28/32, sending its yield to 2.6945 percent.
German Bund futures were little changed at 142.40.
Spot gold fell 0.8 percent to $1,322.49 an ounce after the U.S. data sent the dollar higher.