GLOBAL MARKET-Stocks rally, S&P 500 crosses 3,000 barrier; oil gains

(Adds close of U.S. markets)
* China central bank says it will strengthen economic policy
* Oil gains as supply falls, U.S. rigs hit all-time low
* World FX rates in 2020 http://tmsnrt.rs/2egbfVh

By Herbert Lash and Marc Jones
NEW YORK/LONDON, May 26 (Reuters) - Global equities and oil
rose on Tuesday as China's promise of more stimulus and
prospects of a world economic recovery cheered investors, who
set aside concerns about tense rhetoric between Washington and
Beijing.
The euro got a boost from a weaker dollar as rising optimism
about the easing of coronavirus pandemic lockdowns supported
riskier currencies and sent safe-haven gold lower.
Crude prices rose on growing confidence that producers are
following through on commitments to cut supplies and as fuel
demand has picked up.
U.S. stocks pared gains after President Donald Trump's
economic adviser, Larry Kudlow, said China was making "a big
mistake" with planned national security legislation on Hong Kong
and pledged Washington would pay expenses of U.S. firms that
wanted to shift operations from the city or China. White House spokeswoman Kayleigh McEnany said Trump finds it
hard to see "how Hong Kong can remain a financial hub if China
takes over."
MSCI's gauge of stock performance in 49 countries rose more
than 2% at one point, as did its emerging markets index. The S&P
500 climbed past the 3,000 mark for the first time since March
5, up 37% from March lows but still off about 11% from its
all-time high in February, and it closed under 3,000.
Europe was powered by a 6.9% surge in travel and leisure
stocks .SXTP . On Wall Street, shares of American Airlines
AAL.O and United Airlines Holdings UAL.O rose more than 15%
and U.S.-listed cruise ship operators jumped about the same.
The major boost for investor sentiment is the reopening of
the U.S. and global economies, said Jason Benowitz, senior
portfolio manager at the Roosevelt Investment Group Inc in New
York.
"Reports of economic activity, while still terrible compared
to three months ago, have begun to get less bad as compared to
the prior month," Benowitz said.
Spain said quarantine-free tourism would resume next month
and Germany edged toward a 9 billion-euro bailout
of airline Lufthansa. Spain's Melia Hotels International SA MEL.MC rose 13.6%
and France's Accor SA ACCP.PA 11.3%, the biggest percentage
gainers on the Spanish and French bourses. Norwegian Cruise Line
Holdings Ltd NCLH.K and Royal Caribbean Cruises Ltd RCL.N
were among the top four percentage gainers on the S&P 500.
But the travel industry remained vulnerable. Latin America's
largest airline, LATAM Airlines Group LTM.SN , and its
affiliates in Chile, Peru, Colombia and Ecuador filed for
bankruptcy protection in the United States.
MSCI's all-country world index <.MIWD00000PUS gained 1.6%,
and the pan-European STOXX 600 index .STOXX 1.1%.
The Dow Jones Industrial Average .DJI rose 529.95 points,
or 2.17%, to 24,995.11. The S&P 500 .SPX gained 36.32 points,
or 1.23%, to 2,991.77 and the Nasdaq Composite .IXIC added
15.63 points, or 0.17%, to 9,340.22.
Crude prices were buoyed by Russia's saying its oil output
had dropped close to its target of 8.5 million barrels per day
for May and June under the supply deal reached by major
producers. Brent futures LCOc1 rose 64 cents to settle at $36.17 a
barrel, while U.S. crude CLc1 settled up $1.10 at $34.35.
China's central bank said it would keep pushing to lower
interest rates on loans, helping offset tensions between Beijing
and Washington over trade, the coronavirus and Hong
Kong. MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS advanced 1.7% overnight, with South Korea
.KS11 up 1.75% and Chinese blue chips .CSI300 1.1% higher.
The dollar index =USD fell 0.774%, with the euro EUR= up
0.81% to $1.0987. The Japanese yen JPY= strengthened 0.20%
versus the greenback at 107.50 per dollar.
Benchmark U.S. 10-year Treasury notes US10YT=RR rose 3.4
basis points to yield 0.6932%.
U.S. gold futures GCv1 settled down 1.7% at $1,705.60 an
ounce. Spot gold XAU= dropped 1.1% to $1,711.12.

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