By Chuck Mikolajczak

NEW YORK (Reuters) - A gauge of global stocks hit a record to start September on a high note on Tuesday, as data in major economies showed manufacturing demand rebounding from coronavirus-restricted lows, while the U.S. dollar bounced off its lowest in more than two years.

In the United States, stocks added to gains after two measures of manufacturing activity indicated expansion, with the reading from the Institute for Supply Management hitting its highest level in nearly two years.

Factory activity in China expanded at the fastest rate in nearly a decade in August, a private PMI survey showed on Tuesday, boosting market sentiment overnight and at the European open.

Euro zone manufacturing activity also grew last month to stay on a path toward recovery, though factory managers remained wary about investing and hiring more workers.

"At the moment the market is seeing a lot of positive momentum," said Greg Boutle, U.S. head of equity and derivative strategy at BNP Paribas in New York. "If you get OK- to-good data and anything from the political landscape that looks like its moving more toward a compromise that's constructive for markets."

In addition to the economic data, U.S. stocks got a boost from technology shares as Apple rose 3.98% after a report the company had requested suppliers to make at least 75 million 5G iPhones for later this year.

The Dow Jones Industrial Average rose 215.61 points, or 0.76%, to 28,645.66, the S&P 500 gained 26.34 points, or 0.75%, to 3,526.65 and the Nasdaq Composite added 164.21 points, or 1.39%, to 11,939.67.

The gains pushed the S&P 500 and Nasdaq to closing records.

The rebound in manufacturing can be partly attributed to massive monetary and fiscal stimulus programs implemented across the globe to support economies battered by the coronavirus pandemic.

White House chief of staff Mark Meadows said on Tuesday Senate Republicans are likely to take up their COVID-19 relief bill next week offering $500 billion in additional federal aid. [nL1N2FY0QG]

But not all data was upbeat and European stocks reversed course to close lower for a fourth straight session after Germany cut its GDP forecast for 2021 and a reading on inflation for the bloc turned negative for the first time in more than four years.

The pan-European STOXX 600 index lost 0.35%, while MSCI's gauge of stocks across the globe gained 0.54% at 588.00 after rising as high as 588.10.

The dollar remained weak against a basket of major currencies despite the optimistic data, falling to its lowest level since late April 2018 at 91.737. The greenback had fallen about 1% since Federal Reserve Chair Jerome Powell on Thursday said the U.S. central bank was shifting to average inflation targeting.