* European stocks near 3-month high, euro near 7-1/2 month low
* Eurozone inflation bolsters ECB easing bets
* Brent slips for fifth day ahead of Friday OPEC meeting
* Fed’s Lockhart says “compelling” case to raise U.S. rates (Adds U.S. market open; changes dateline; previous LONDON)
By Chuck Mikolajczak
NEW YORK, Dec 2 (Reuters) - The dollar hit an 8-1/2 month high on Wednesday as economic data supported a rate hike by the U.S. Federal Reserve in December, while U.S. stocks were little changed as investors awaited comments from Fed Chair Janet Yellen.
European stocks hovered at a 3-1/2 month high and the euro was just above a 7-1/2-month low as euro zone inflation remained barely visible and kept expectations intact the European Central Bank will engage in more stimulus after its meeting on Thursday.
U.S. private employers boosted hiring in November. The ADP National Employment Report showed private payrolls increased 217,000 last month while a separate report showed nonfarm productivity grew at a faster pace than previously thought in the third quarter.
“We had some economic data which supports a rate hike in December,” said Peter Cardillo, chief market economist at First Standard Financial in New York.
“The market wants to be reassured of the fact the Fed is not going to be aggressive. We are just buying time until we hear the words of wisdom out of Mrs. Yellen.”
The euro dropped back below $1.06 as the first reading of November euro zone inflation stayed at 0.1 percent, far below the ECB’s near 2-percent target and adding to worries that it could stifle any serious economic growth.
The Dow Jones industrial average fell 23.38 points, or 0.13 percent, to 17,864.97, the S&P 500 lost 4.44 points, or 0.21 percent, to 2,098.19 and the Nasdaq Composite added 12.02 points, or 0.23 percent, to 5,168.32.
MSCI’s all-country world index of equity performance in 46 countries shed 0.29 percent. The pan-European FTSEurofirst was up 0.1 percent.
Markets are expecting another round of easing from the ECB on Thursday, including an expansion of its bond-buying program and even higher charges for commercial banks that hoard cash.
With the euro back on the slide, the U.S. dollar index pushed back above the 100 threshold, just below the 12-year high of 100.39 it had hit in March.
Federal Reserve head Janet Yellen speaks in Washington later, with the Fed widely expected to pull the trigger on Dec. 16, its first hike in U.S. interest rates in almost a decade.
Four other Fed members were also due to speak on Wednesday, with Atlanta Fed President Dennis Lockhart saying there was a “compelling” case to raise U.S. rates.
Recent economic data pointed to weakness in the manufacturing sector but other data continued to suggest the U.S. economy remains on solid footing.
Benchmark 10-year Treasuries notes were off 6/32 in price to yield 2.178 percent.
The strengthening dollar put pressure on commodities, with oil also pushed lower by an unexpected rise in U.S. inventories.
Brent oil prices dropped for a fifth straight session and were last down 1.9 percent at $43.61 a barrel, while U.S. crude was down 2.3 percent at $40.91.
Copper lost 0.5 percent to $4,607.00 a tonne after falling as low as $4,565.00, and spot gold was off 1.3 percent at $1,055.61 an ounce.
Additional reporting by Shinichi Saoshiro; Editing by Gareth Jones and Nick Zieminski