(Updates to afternoon) NEW YORK, Oct 8 (Reuters) - U.S. stock indexes touched one-month highs and crude prices gained ground on Thursday amid signs of progress in fiscal aid negotiations. U.S. House Speaker Nancy Pelosi said emergency aid for commercial airlines was a matter of national security and could only pass through Congress with assurances that negotiations will continue toward crafting a broader pandemic relief package. And while White House adviser Larry Kudlow said the Trump administration would like to see “standalone” bills to provide additional unemployment assistance and extend the Paycheck Protection Program, Senate Leader Mitch McConnell warned there remain “vast differences” between Democrats and Republicans regarding the size of a more comprehensive deal. “We’re seeing the broad market lift and certainly cyclical sectors are doing well,” said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York. “That shows that the market is anticipating some kind of package.” Democratic nominee Joe Biden has been advancing in the polls ahead of the Nov. 3 election, now less than a month away. “Overall, the market seems very accepting of a potential Biden win and Democratic gains in the Senate,” Ghriskey added. “The market usually tends to prefer gridlock where change happens slowly, but in the short-term you’d get a stimulus bill if there’s a clean sweep by either party.” The U.S. Labor Department reported that jobless claims, while edging lower last week, remain stubbornly high and well above the highest levels reached at the nadir of the Great Recession, suggesting recovery of the labor market could be stalling. The Dow Jones Industrial Average rose 102.15 points, or 0.36%, to 28,405.61, the S&P 500 gained 25.62 points, or 0.75%, to 3,445.07 and the Nasdaq Composite added 57.04 points, or 0.5%, to 11,421.64. European stocks joined the world rally, hitting near three-week highs as signs of movement in coronavirus aid talks lifted the global mood. The pan-European STOXX 600 index rose 0.78% and MSCI’s gauge of stocks across the globe gained 0.76%. Emerging market stocks rose 0.93%. MSCI’s broadest index of Asia-Pacific shares outside Japan closed 0.84% higher, while Japan’s Nikkei rose 0.96%. Treasury prices firmed and the yield curve flattened a bit amid weaker-than-expected economic data. Benchmark 10-year notes last rose 6/32 in price to yield 0.7669%, from 0.785% late on Wednesday. The 30-year bond last rose 17/32 in price to yield 1.5656%, from 1.589% late on Wednesday. Crude prices topped $43 per barrel as output shutdowns related to hurricanes in the Gulf of Mexico and an ongoing oil worker strike in Norway, and possible OPEC production cuts pressured supply. U.S. crude futures gained 3.10% to settle at $41.19 per barrel, while Brent settled at $43.34 per barrel, advancing 3.22% on the day. The dollar inched lower against a basket of world following Pelosi’s remarks. The dollar index fell 0.03%, with the euro down 0.03% to $1.1757. The Japanese yen weakened 0.04% versus the greenback at 106.03 per dollar, while Sterling was last trading at $1.2933, up 0.12% on the day. Election uncertainty and pandemic relief optimism also lifted gold. Spot gold added 0.3% to $1,892.01 an ounce.