* U.S. shares gain on quarterly earnings reports
* Greek parliament's approval of bailout plan boosts shares
* U.S. short-dated yields rise on expected Fed rate hike
* Dollar rallies to more than seven-week high
* Oil prices rise after power outage hits UK oilfield (Updates to close of European stock, bond markets)
By Sam Forgione
NEW YORK, July 16 (Reuters) - The Greek parliament's approval of a third bailout program for the debt-stricken country boosted world stock markets, with Wall Street also buoyed by robust corporate earnings, while the U.S. dollar rose on expectations of higher interest rates.
Strong quarterly reports from U.S. blue chip companies helped U.S. shares, while European markets cheered news that the European Central Bank was pressing ahead with its economic stimulus program, had agreed to more funding for Greek banks, and promised further action if needed. ID:nL5N0ZW23F ID:nL5N0ZW2RR
European shares hit a more than six-week high after the parliament in Athens approved austerity measures demanded by its lenders to open talks on the new bailout. The Greek parliament's vote left the government without a majority. ID:nL5N0ZW0VG
While the political climate in Greece remained fragile, with the International Monetary Fund saying this week that the country's debt was unsustainable, investors were willing to give a cautious thumbs-up to the Greek parliament's approval of the bailout plan.
"The deal has accomplished the objectives of the ECB and the IMF, which is to take Greece off the crisis burner and put it into the slow cooker," said John Rutledge, chief investment strategist at Safanad in New York. "The remaining issue is whether Greece will live up to what they agree to do."
MSCI's all-country world equity index .MIWD00000PUS , which tracks shares in 45 nations, was last up 0.64 percent at 431.74.
On Wall Street, the Nasdaq climbed to a three-week high and the S&P 500 was within 1 percent of its record peak as bellwether companies such as Citigroup C.N , eBay EBAY.O and Netflix NFLX.O reported strong results.
The Dow Jones industrial average .DJI was last up 0.24 percent at 18094.16. The S&P 500 .SPX was up 0.65 percent at 2121.10, and the Nasdaq Composite .IXIC was last up 1 percent at 5149.118.
The FTSEurofirst 300 index .FTEU3 of top regional shares closed up 1.4 percent at 1,608.71, near a more than six-week high of 1,613.61 hit earlier.
The dollar index .DXY , which measures the greenback against a basket of six major currencies, rallied to a more than seven-week high of 97.756 after Fed Chair Janet Yellen said on Wednesday a rate hike is likely this year. ID:nL5N0ZW358
Yellen is due to testify to the Senate Banking Committee on Thursday.
The euro hit $1.08550 EUR=EBS , a more than seven-week low against the dollar. Short-dated Treasuries prices slipped on the favorable interest rate outlook, with three-year notes US3YT=RR last down 4/32 in price to yield 1.05 percent, from a yield of 1 percent late Wednesday. Yields move inversely to prices. ID:nN9N0ZU000
"People are realizing what (Yellen) said, that every meeting is on the table going forward, and thinking maybe we shouldn't be long the front-end," said Charles Comiskey, head of Treasuries trading at Bank of Nova Scotia in New York.
Brent crude oil prices rose after a power outage closed the UK's largest oilfield. Data also showed a fall in crude inventories and strong demand from refineries in the United States. ID:nL4N0ZW1TK
Brent crude for August LCOc1 was last up 74 cents at $57.79 a barrel. U.S. light crude CLc1 was last down 22 cents at $51.19. ID:nL4N0ZW1TK
Spot gold prices XAU= hit an eight-month low of $1,142.10 on expectations for a Fed rate hike this year. ID:nL4N0ZW2R5