Peace Hopes Boost Global Stocks, Dollar : Trading: Tokyo’s Nikkei index hits a six-month high. Shares also rise in Europe. Crude oil prices ease.

The possibility of an early resolution to the Persian Gulf War boosted stock prices and the U.S. dollar on world markets Monday, while oil prices headed lower.

The markets reacted largely to a 3 1/2-hour meeting between Soviet President Mikhail S. Gorbachev and Iraqi Foreign Minister Tarik Aziz in Moscow.

Gorbachev’s press spokesman, Vitaly Ignatenko, described the talks as “very constructive,” and said Aziz would return to Baghdad as soon as possible with a peace plan devised by Gorbachev. He refused, however, to provide details of the plan.

Nonetheless, the prospect of peace sparked buying interest on major global stock markets and in the dollar in foreign exchange.

There was no trading in the United States because the financial and commodity markets were closed for the Presidents’ Day holiday.

In Tokyo, where the global trading day begins, the stock exchange’s key index soared to a six-month high in brisk trading.

The Nikkei 225-share average gained 886.27 points, or 3.5%, to close at 26,230.01. It was the first time the market’s main barometer had closed above 26,000 points since Aug. 21, when it ended at 26,297.84.

Tokyo’s rise helped push up prices on the London Stock Exchange. The Financial Times 100-stock index closed up 21.4 points, or 0.9%, at 2,318.3.

However, volume was off from Friday, with many investors reluctant to play the market without any lead from Wall Street.

London trading also was slightly dampened by bomb explosions at two London railway stations, which prompted the closure of all British Rail stations in the capital, disrupting the morning rush hour.

German shares also rallied in what many dealers saw as an astonishing show of optimism linked to hopes for a quick end to the Gulf War. The 30-share DAX index jumped 41.38 points to 1,572.57 for a rise of 2.70%.

In foreign exchange, the dollar gained ground against major currencies in Europe and Tokyo. Currency dealers said an end to the fighting in the Persian Gulf would help aid U.S. deficit-cutting efforts and thereby the economy and dollar.

The dollar rose to 1.4845 German marks in late afternoon London trading, up from its Friday close in New York of 1.4765 marks.

Earlier, in Tokyo, the dollar rose 0.29 yen to a closing 129.95 yen. It was quoted in London at 130.45 yen.

The dollar gained ground against the British pound in London, with sterling falling to $1.9600 from $1.9680 late Friday.

Other late dollar rates in Europe, compared to late Friday’s quotes, included: 1.2730 Swiss francs, up from 1.2685; 5.0518 French francs, up from 5.0310; 1.6725 Dutch guilders, up from 1.6635; 1,113.38 Italian lire, up from 1,110.00, and 1.1526 Canadian dollars, down from 1.1543.

Gold fell in London to a late bid price of $363.00 an ounce from $365.25 late Friday. Gold fell in Zurich to $364 an ounce from $364.85 and in Hong Kong to $365.98 from $369.97.

Silver bullion fell in London to a late bid price of $3.78 an ounce from Friday’s $3.84.

In the oil markets, prices in Europe sank near their lowest level in seven months as Gorbachev met with Aziz in Moscow.

In London, prices for North Sea Brent, a marker for internationally traded crude oil, closed at $16.50 a barrel, down 54 cents from Friday’s close and just 20 cents above the seven-month lows struck on Friday.

“The market was very jumpy, looking for what comes out of the Soviet initiative,” said one London-based futures trader.

Oil prices had plunged Friday in New York after Iraq said it would consider pulling out of Kuwait.