GLOBAL MARKETS-U.S. fiscal deal prompts rally in stocks, commodities

* Global shares jump after U.S. Congress passes budget deal * Dollar down, euro rises on increase in risk appetite * Oil jumps as commodities join rally in risky assets By Ryan Vlastelica NEW YORK, Jan 2 (Reuters) - Global stock surged while commodities rallied on Wednesday after U.S. legislators struck a deal to halt a round of automatic fiscal tightening that threatened to push the world's largest economy into recession. The deal reached on Tuesday to avert the "fiscal cliff" put off the immediate pain of income tax hikes for almost all U.S. households but did nothing to resolve other political impasses on the budget that loom in coming months, including the debt ceiling. Spending cuts of $109 billion in military and domestic programs were only delayed for two months. The deal boosted investors' appetite for riskier assets and depressed the U.S. dollar against major currencies. Brent crude oil hit an 11-week high of almost $113 per barrel and gold prices rose more than 1 percent to a two-week high. "The deal certainly brightens the prospects for economic growth, and traditionally speaking, the first week of the year generally sets the stage for the rest of the year for equities - so this is positive," said Peter Cardillo, chief market analyst for Rockwell Global Capital in New York. The vote in Congress removed a major uncertainty hanging over markets, but some analysts cautioned that the optimism could fade if U.S. economic data later this week, including the December payroll report, disappoints. U.S. manufacturing expanded slightly in December, bouncing back from an unexpected contraction the prior month, according to an industry report released on Wednesday. The Dow Jones industrial average was up 226.73 points, or 1.73 percent, at 13,330.87. The Standard & Poor's 500 Index was up 24.95 points, or 1.75 percent, at 1,451.14. The Nasdaq Composite Index was up 67.46 points, or 2.23 percent, at 3,086.97. The MSCI all-country world equity index rose 1.6 percent. The pan-European FTSEurofirst 300 closed 2.1 percent higher. In currency markets, the euro was at $1.3172 after reaching a two-week high earlier in the session. The U.S. dollar rose 0.1 percent against a basket of major currencies. The dollar traditionally rises when markets sense risk and falls when tensions subside. It was a similar story for government debt, with prices of higher-yielding Spanish and Italian bonds up and the German equivalent, usually favored by risk-averse investors, falling. The Bund future was on track for its biggest daily fall since September, down 1.6 points to 144.04. The benchmark 10-year U.S. Treasury note was down 21/32 in price to yield 1.8301 percent. Venezuela's U.S. dollar-denominated sovereign bonds rallied across the yield curve on Wednesday. The benchmark 2027 Global bond gained 1.536 points in price to bid 99.79, yielding 9.273. Argentina's Global Par bonds, maturing in 2038, showed a bid price gain of 0.753 point to 35.866, yielding 11.139 percent. Brent rose 0.95 percent to $112.16 per barrel. U.S. crude rose 1.1 percent to $92.84.