GLOBAL MARKETS-Stocks climb as yields pull back from earlier high

(Updates to open of U.S. markets, changes byline, dateline;
previous MILAN)
* U.S. Senate passes $1.9 trillion stimulus
* Dollar gains on euro, yen as U.S. yields race ahead
* Brent retreats after topping $70 for first time since
January
2020

By Chuck Mikolajczak
NEW YORK, March 8 (Reuters) - A gauge of global stocks rose
in choppy trading on Monday as investors eyed the yield on U.S.
Treasuries for signs of inflation pressures in the wake of the
U.S. Senate's passage of a $1.9 trillion stimulus bill.
After climbing as high as 1.613% on the session, the third
time above 1.6% in the past year, yields on the benchmark
10-year U.S. Treasury note eased, removing some of the earlier
pressure off equities.
"The fact they haven't climbed back through 1.6% is
encouraging, which is why you saw the market turn around," said
Ken Polcari, managing partner at Kace Capital Advisors in
Jupiter, Florida.
"People expect that rates are going up, that is for sure,
but it depends on the speed and the pace, and if it takes until
December for the rates to hit 2%, that is fine that is nine
months away, the market will have plenty of time to adjust. But
if it happens in a month, then that is going to be a different
story."
Benchmark 10-year notes US10YT=RR last fell 11/32 in price
to yield 1.5924%, from 1.554% late on Friday.
Investors have wrestled with whether the stimulus will help
global growth rebound faster from the COVID-19 downturn or could
cause the world's biggest economy to overheat and lead to
runaway inflation, outweighing the benefits.
U.S. Treasury Secretary Janet Yellen said on Monday that
President Joe Biden's $1.9 trillion coronavirus aid package will
provide enough resources to fuel a "very strong" U.S. economic
recovery, but noted there "are tools" to deal with inflation.

Analysts largely expect an acceleration in inflation, which
has been stoked in part by the latest climb in oil prices, which
on Monday briefly climbed above $70 for the first time since
January 2020.
On Wall Street, major averages rebounded as yields eased,
with the tech-heavy Nasdaq bouncing from a drop of as much as
0.86%. The technology sector and other richly-valued names have
been highly susceptible to rising rates.
The Dow Jones Industrial Average .DJI rose 453.17 points,
or 1.44%, to 31,949.47, the S&P 500 .SPX gained 33.04 points,
or 0.86%, to 3,874.98 and the Nasdaq Composite .IXIC added
37.38 points, or 0.29%, to 12,957.53.
The pan-European STOXX 600 index .STOXX rose 2.12% and
MSCI's gauge of stocks across the globe .MIWD00000PUS gained
0.44%.
Economic data also pointed to a continued recovery, as the
Commerce Department said wholesale inventories increased solidly
in January despite a surge in sales, suggesting inventory
investment could again contribute to economic growth in the
first quarter. On foreign exchange markets, the dollar index =USD shot up
to a high of 92.341, its highest since November 24.
The dollar index =USD rose 0.479%, with the euro EUR=
down 0.5% to $1.1857.
The Japanese yen weakened 0.49% versus the greenback at
108.83 per dollar, while Sterling GBP= was last trading at
$1.3813, down 0.20% on the day.
The jump in yields and the dollar has weighed on gold, which
offers no fixed return. Spot gold XAU= dropped 1.1% to
$1,682.39 an ounce after hitting a nine-month low of $1,678.40.

Oil prices rose to their highest levels in more than a year
after attacks on Saudi Arabian oil sites and the stimulus
passage, before reversing course to trade lower on the day.
U.S. crude CLc1 recently fell 1.35% to $65.20 per barrel
and Brent LCOc1 was at $68.47, down 1.28% on the day.

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2021 asset performance http://tmsnrt.rs/2yaDPgn
World FX rates in 2021 http://tmsnrt.rs/2egbfVh
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