* H&M leads European shares lower after sales miss
* Dollar index firmer as volumes thin ahead of holidays (Updates to U.S. trading open; changes byline, dateline, previously LONDON)
By Stephanie Kelly
NEW YORK, Dec 15 (Reuters) - World shares gained on Friday and Wall Street opened higher on U.S. tax legislation optimism, while the dollar strengthened as trading activity wound down before the Christmas and New Year holidays.
MSCI's gauge of stocks across the globe gained 0.16 percent after a week of central bank meetings that saw the U.S. Federal Reserve raise interest rates, while the European Central Bank and the Bank of England held off on hikes.
The Dow Jones Industrial Average rose 125.21 points, or 0.51 percent, to 24,633.87, the S&P 500 gained 16.99 points, or 0.64 percent, to 2,669 and the Nasdaq Composite added 38.09 points, or 0.56 percent, to 6,894.62.
Wall Street equities were boosted by gains in consumer stocks such as Costco Wholesale rising 3.75 percent after the retailer reported upbeat results.
On Thursday, the S&P 500 fell the most in a month after Republican Senators Marco Rubio and Mike Lee declined to back the bill without changes to child tax credits.
""What Rubio was looking for is more help for the lower-income people, child tax credits. That's something that can easily be adjusted, so the bill will move forward," said Andre Bakhos, managing director at Janlyn Capital in New Jersey.
Europe's STOXX 600 was down 0.38 percent, as a 12.68 percent slump in fashion giant H&M and a 6.38 percent drop for Italian luxury goods firm Ferragamo spooked retailers.
Emerging market stocks lost 0.32 percent. MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.42 percent.
Japan's Nikkei stock index finished down 0.6 percent at its lowest in more than a week, with mobile firms extending a selloff on concerns of increased competition after e-commerce group Rakuten said it aims to become the country's fourth wireless carrier.
The U.S. dollar strengthened as investors wound down trading activity after the central bank meetings during the week and before the Christmas and New Year holidays.
The greenback rose and fell throughout the week after news surrounding the policy meetings and tax reform.
"Markets are really consolidating at this point into holiday trading," said Mark McCormick, North American head of FX strategy at TD Securities in Toronto.
"People will be eyeing up the U.S. tax plan. There are expectations building they could have it done by next week, if not that pushes if off until next year. That's your last major risk event," McCormick added.
News the European Union had formally agreed to move Brexit talks onto trade and a transition pact triggered a 0.77 percent drop in the pound, as traders cashed in recent gains.
The New Zealand dollar rose 0.36 percent after the country's Finance Minister Grant Robertson said he was comfortable with the currency's general trend.
The euro was down 0.03 percent to $1.1774.
Benchmark 10-year notes last fell 9/32 in price to yield 2.3762 percent, from 2.346 percent late on Thursday.
The 30-year bond last fell 5/32 in price to yield 2.717 percent, from 2.71 percent late on Thursday.
In commodity markets, U.S. crude rose 0.23 percent to $57.17 per barrel and Brent was last at $63.28, down 0.05 percent on the day.
Spot gold added 0.2 percent to $1,254.79 an ounce. U.S. gold futures gained 0.03 percent to $1,257.50 an ounce.
Reporting by Stephanie Kelly; Additional reporting by Marc Jones in London, Karen Brettell in New York, Rama Venkat Raman in Bengaluru; Editing by Nick Zieminski