NEW YORK (Reuters) - Stock markets around the world were up slightly on Wednesday amid signs that Italy would cut its budget deficits in coming years, but U.S. Treasuries yields hit multi-year highs after strong U.S. jobs data, while oil prices saw 4-year highs ahead of U.S. sanctions on Iran exports.

FILE PHOTO: A man looks at an electronic board displaying stock index outside a bank in downtown Milan June 13, 2013. REUTERS/Alessandro Garofalo

On Wall Street, the Dow Jones Industrial Average rose to a record high helped by U.S. data showing private sector payrolls saw the biggest monthly gain since February. Financial stocks gained from a rebound in European markets and rising Treasury yields.

The Dow Jones Industrial Average rose 54.45 points, or 0.2 percent, to 26,828.39, the S&P 500 gained 2.08 points, or 0.07 percent, to 2,925.51 and the Nasdaq Composite added 25.54 points, or 0.32 percent, to 8,025.09.

MSCI’s gauge of stocks across the globe gained 0.02 percent.

U.S. Treasury yields reached multi-year peaks, with the 10-year note’s yield at its highest since 2014 and maturities at the short end of the curve at decade highs, after economic data bolstered the case for the Fed to raise interest rates in December.

Benchmark 10-year notes last fell 30/32 in price to yield 3.1662 percent. The 30-year bond last fell 67/32 in price to yield 3.3206 percent.

The yield on the benchmark 10-year note was on track for its largest daily jump since the U.S. presidential election in November 2016 as U.S. service sector activity hit a 21-year high and the ADP private payrolls data for September came in stronger than expected.

“Just the recognition of the Fed saying the economy is good, that means they are not going to slow down any time soon the rate of rate increases,” said Mike Baele at managing director at U.S. Bank Private Client Wealth Management in Portland, Oregon.

The U.S. dollar also gained after the release of the ADP data, which comes ahead of the more comprehensive non-farm payrolls data on Friday.

Stock markets around the world initially rose after a report said Italy’s deficit would fall to 2.2 percent of gross domestic product in 2020 and to 2.0 percent in 2021 from the 2.4 percent earlier outlined, easing concerns that Italian budget deficits could deepen its debt problems and stoke conflict with the European Union.

Italian 10-year borrowing costs eased off 4-1/2-year highs, after jumping 50 basis points since budget details emerged last Thursday. Two-year yields fell 10 bps.

The improved mood toward Italy also reduced the premium investors demand for holding Italian risk relative to that of safer Germany to around 290 bps, down from a five-year high over 300 bps on Tuesday, and sapped demand for safe-haven assets such as German bonds and Swiss franc.

“Today, so far, has been better-than-expected performance out of Europe,” said Michael Antonelli, managing director of institutional sales trading at Robert W. Baird in Milwaukee.

The pan-European equity index rose 0.5 percent, while the Milan bourse jumped more than one percent. The moves were led by an initial 3.1 percent bounce in Italian banks.

Lingering concerns about Italy’s budget negotiations continued to weigh on the euro, which was down 0.3 percent to $1.1517. The single currency hit a six-week trough of $1.1506 on Tuesday after an Italian lawmaker said his country might be better off with its “own currency.”

In oil, Brent crude rose nearly 2.0 percent after hitting a four-year high as the market focused on upcoming U.S. sanctions on Iran while shrugging off the year’s largest weekly build in U.S. crude stockpiles and reports of higher Saudi Arabian and Russian production. [O/R]

Brent crude rose $1.49, or 1.8 percent, to settle at $86.29 a barrel, after hitting $86.74, its highest since Oct. 30, 2014. U.S. crude settled $1.18, or 1.6 percent, higher at $76.41 a barrel, after touching a session high of $76.90.