NEW YORK (Reuters) - The dollar gained and a gauge of global equity markets surged for a third day on Wednesday, as investors cheered expectations of more central bank stimulus and reports that scientists were developing a vaccine for the deadly coronavirus.

U.S Treasury yields rose on early reports that a Chinese university team found a drug to treat people infected with the virus while UK researchers said they made a “significant breakthrough” in finding a vaccine.

A total of 24,363 cases have been confirmed in China, including 490 deaths. The World Health Organization said there are “no known proven effective therapeutics” against the virus.

Euro zone business activity accelerated in January, hinting the worst may be over for the bloc’s economy, and U.S. data fed hopes for moderate growth even as consumer spending slows.

MSCI’s gauge of stocks across the globe gained 0.86%, just 1% from a record high set two weeks ago. But the Nasdaq and S&P 500 on Wall Street set new closing highs.

Yousef Abbasi, global market strategist at INTL FCStone Financial Inc in New York, said risk assets got a lift from stimulus efforts by China’s central bank and U.S. Federal Reserve operations in the repo market.

“I have a tough time justifying why this market is trading at 19 times earnings and why we have managed to snap back from any sell-off since October,” Abbasi said, regarding U.S. stocks.

“But at this point, looking at this market, it almost feels like any hiccup further emboldens the global central bank put,” he said, referring to central bank activity that increases market liquidity and encourages risk taking.

Investors are hungry for risk again after markets reeled from U.S.-Iran tensions and the coronavirus outbreak, said Valentin Marinov, head of G10 FX Strategy at Credit Agricole CIB Global Markets in London.

FILE PHOTO: Investors sit in front of a board showing stock information at a brokerage house on the first day of trade in China since the Lunar New Year, in Hangzhou, Zhejiang province, China February 3, 2020. China Daily via REUTERS/File Photo

“There is a lot of cash on the side-lines that is now being invested in risk assets and carry trades,” Marinov said.

The Dow Jones Industrial Average rose 483.22 points, or 1.68%, to 29,290.85. The S&P 500 gained 37.1 points, or 1.13%, to 3,334.69 and the Nasdaq Composite added 40.71 points, or 0.43%, to 9,508.68.

In Europe, the pan-regional STOXX 600 index rose 1.23% and emerging market stocks rose 0.51%.

IHS Markit’s final euro zone composite Purchasing Managers’ Index (PMI), seen as a good indicator of economic health, rose to a five-month high of 51.3 in January from 50.9 the previous month.

U.S. data also was encouraging.

The Institute for Supply Management (ISM) said its non-manufacturing activity index increased to 55.5 in January, its highest since August. December’s reading was revised slightly down to 54.9 instead of the previously reported 55.0.

Readings above 50 indicate economic expansion.

The dollar gained against the safe-haven Japanese yen and Swiss franc, as risk appetite rose. The U.S. currency also benefited from a private-sector payrolls report for January that surpassed market expectations, suggesting the world’s largest economy was on a stable growth path and interest-rate cuts were off the table for now.

The dollar index rose 0.32%, with the euro down 0.4% to $1.0998. The yen weakened 0.28% versus the greenback at 109.85 per dollar.

Overnight in Asia, stringent containment measures, along with the billions of dollars Chinese authorities have pumped into the economy, boosted mainland China indexes more than 1%. The bourses have clawed back half of the $700 billion in market capitalization that was wiped out during Monday’s almost 8% rout.

Oil prices jumped on the reports of a potential vaccine.

Brent crude oil futures rose $1.32 to settle up at $55.28 a barrel. U.S. West Texas Intermediate (WTI) crude gained $1.14 to settle at $50.75.

Benchmark 10-year notes fell 15/32 in price to yield 1.6526%.

Gold rose. U.S. gold futures settled 0.5% up at $1,562.80.