GLOBAL MARKETS-Stocks climb, dollar drops as Fed chair remarks boost rate-cut hopes

* U.S. Treasuries yields fall following Powell remarks
* Dollar drops against yen, euro
* Oil prices up as U.S. stockpiles fall
* GRAPHIC-World FX rates in 2019: http://tmsnrt.rs/2egbfVh
* GRAPHIC-Asian stock markets: https://tmsnrt.rs/2zpUAr4

(Updates to open of U.S. markets, changes byline, dateline;
previous LONDON)
By April Joyner
NEW YORK, July 10 (Reuters) - A broad index of world stock
markets edged higher on Wednesday while the U.S. dollar fell as
comments from Federal Reserve Chairman Jerome Powell bolstered
expectations for an interest rate cut from the U.S. central bank
this month.
MSCI's broadest index of world stocks .MIWD00000PUS
climbed 0.27%, with U.S. equities touching record highs
following the release of prepared remarks for Powell's testimony
before U.S. House of Representatives Financial Services
Committee. The U.S. benchmark S&P 500 index .SPX briefly hit
the 3,000 mark for the first time ever.
Powell said the Fed was ready to "act as appropriate" to
sustain a decade-long U.S. economic expansion and pointed to
economic risks including persistently weak inflation, slowing
global growth and a downturn in business investment.
After his remarks, interest rate futures appeared to price
in greater odds of an aggressive rate cut this month.
Expectations for a 50-basis-point cut, which had nearly been
snuffed out following stronger-than-expected U.S. employment
data on Friday, jumped to 23.5%, according to CME Group's
FedWatch tool.
Yields on short-dated U.S. Treasuries, which had ticked
higher in recent sessions after stronger-than-expected
employment data on Friday, fell on Powell's remarks. The
two-year Treasury yield, a proxy for market sentiment about
interest rate policy, was last 7.5 basis points lower at
1.8297%. The dollar index .DXY , tracking the greenback against six
major currencies, dropped 0.29%. Shortly following the release
of Powell's remarks, it hit session lows against the yen JPY=
and euro EUR= . The yen was last 0.28% stronger against the dollar at
108.53, while the euro rose 0.31% against the greenback to
$1.1241.
"Chairman Powell did not do anything to push back against
the market expectation of an upcoming rate cut," said Keith
Lerner, chief market strategist at SunTrust Advisory Services in
Atlanta. "So we've seen a little bit of a rally. Our take on it
is that the path of least resistance over the next 12 months
(for U.S. stocks) remains higher."
"The easing of the dollar is a good thing overall," he
added. "That's a positive for international markets and for
financial conditions."
The Dow Jones Industrial Average .DJI rose 43.35 points,
or 0.16%, to 26,826.84, the S&P 500 .SPX gained 7.23 points,
or 0.24%, to 2,986.86 and the Nasdaq Composite .IXIC added
28.44 points, or 0.35%, to 8,170.16.
In Europe, the STOXX 600 .STOXX briefly turned positive
following Powell's comments but was last down 0.15%.
Benchmark 10-year notes US10YT=RR last rose 4/32 in price
to yield 2.0439%, from 2.056% late on Tuesday.
In commodity markets, oil prices rose as U.S. crude
inventories shrank more than expected and as major producers
evacuated rigs in the Gulf of Mexico before a storm.
Brent crude futures LCOc1 were up $1.92, or 3%, to $66.08
a barrel, while U.S. West Texas Intermediate crude futures
CLc1 climbed $1.75, also 3%, to $59.58 a barrel.
Spot gold XAU= added 0.6% to $1,405.84 an ounce.


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Asia stock markets https://tmsnrt.rs/2zpUAr4
Asia-Pacific valuations https://tmsnrt.rs/2Dr2BQA
Bond yields take the plunge https://tmsnrt.rs/2G4F7jg
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