NEW YORK (Reuters) - The euro rebounded against the US dollar yesterday and global stocks gained amid a recent raft of upbeat economic data and on speculation the European Central Bank (ECB) had boosted its buying of sovereign debt.

Investors were disappointed by the lack of a more aggressive policy response by the ECB to the debt crisis after its monthly meeting, but the euro rose on reports the bank was buying Portuguese and Irish debt.

Traders reported ECB purchases triggered a drop in the premium investors demand to buy Portuguese and Irish bonds over German benchmarks. They said the ECB had been buying the two countries’ debt at a modestly higher rate recently.

President Jean-Claude Trichet said the ECB decided to conduct three-month liquidity operations in January, February and March “with full allotment”. Until recently the central bank had been expected to phase out unlimited liquidity measures.

The ECB kept interest rates on hold at 1.0 percent as expected and extended its liquidity safety net for vulnerable euro zone banks, promising to provide unlimited weekly, monthly and three-month funding until at least April.

European equities hit a two-week closing high after falling on news of weaker-than-expected US jobless claims data. Analysts stayed positive on the equity market’s outlook.

The FTSEurofirst 300 index of top European shares finished up 1.6 percent at 1,106.18 points, its highest close since November 18.

The ECB “basically said we will do what it takes and while you can never know what a band-aid will look like at any point in time, I think the overall theme is that those band-aids will be found”, said Bob Doll, chief equity strategist for fundamental equities at BlackRock Inc.

Data for pending US home sales showed an unexpected jump in October and higher-than-expected sales by US retailers in November boosted investor sentiment.

Also, Goldman Sachs Group Inc said US banks are on stronger footing due to an improving economy, higher equity prices and a favourable interest rate environment.

Earlier in Asia, Japan’s Nikkei share average hit a five-month high, rising 1.8 percent to the highest close since June 22. The MSCI index of Asia Pacific stocks outside Japan was up 1.7 percent.