By Saqib Iqbal Ahmed
NEW YORK (Reuters) - Global stock markets rose and sterling slid on Thursday after the Bank of England cut interest rates and revived a bond-buying program to cushion the economic blow from Britain's June 23 vote to leave the European Union.
U.S. stocks and the dollar traded in a tight range as investors exercised caution ahead of Friday's jobs report that could offer clues to the timing of the next U.S. rate hike.
The Bank of England cut its main rate by a quarter percentage point to a record low 0.25 percent and said it would take "whatever action is necessary" to achieve stability in the wake of Britain's vote to leave the EU.
The rate cut was widely expected but not the other measures.
"The Bank of England has hit a perfect 'High Five' at today's meeting, over-delivering against market expectations and bucking the recent trend of central banks disappointing," said Nick Gartside, a JP Morgan Asset Management portfolio manager.
MSCI's world stocks index , which tracks shares in 45 nations, snapped a three-day losing streak and was up 0.33 percent.
Wall Street, meanwhile, was subdued as investors kept to the sidelines ahead of Friday's U.S. payrolls report.
"Folks would probably prefer to wait on those numbers before they make a commitment in front of them," said Gary Bradshaw, portfolio manager at Hodges Capital Management in Dallas.
The number of Americans filing for unemployment benefits unexpectedly rose last week, and orders for factory goods fell for a second straight month in June.
The labor market, however, remains healthy and will probably continue to support economic growth for the remainder of this year.
The Dow Jones industrial average (.DJI) fell 2.95 points, or 0.02 percent, to close at 18,352.05, the S&P 500 (.SPX) gained 0.46 point, or 0.02 percent, to finish at 2,164.25 and the Nasdaq Composite (.IXIC) added 6.51 points, or 0.13 percent, to end at 5,166.25.
Europe's broad FTSEurofirst 300 index (.FTEU3) closed up 0.72 percent at 1,331.68, its best day in two weeks. Strength in major financial and industrial stocks such as Aviva Plc (AV.L) and Siemens AG (SIEGn.DE) boosted the region's equity markets.
The BoE's easing measures hammered sterling, which fell 1.52 percent at $1.3120 (GBP=D4), its largest one-day drop against the dollar in a month.
"Sterling/dollar has weakened in line with our view and we still see scope for further downside in the pair," said Sam Lynton-Brown, FX strategist at BNP Paribas in London.
The dollar index (.DXY), which tracks the greenback against six major currencies, drew strength from the gains against sterling and was up 0.22 percent at 95.773.