(Updates prices, market activity, comment)
* Dollar gains on euro, yen as U.S. yields race ahead
* Gold slides to 9-month low
* U.S. stock indexes higher except tech-heavy Nasdaq
* Banks, automakers lift European stocks
* Oil futures settle down 1.6%
By Chuck Mikolajczak and Matt Scuffham
NEW YORK, March 8 (Reuters) - A gauge of global stocks
dipped 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, the U.S. 10-year Treasury
yield held near a more than one-year high.
"If rates are grinding higher because people are getting
optimistic about what economic growth looks like, that is still
supportive for equity prices," said Tom Hainlin, global
investment strategist at U.S. Bank Wealth Management's Ascent
Private Wealth Group in Minneapolis.
"It is just if those rates start to get away from you on
inflation expectations, then the multiples on stocks come down
and there is more concern about that," he added.
Benchmark 10-year notes US10YT=RR last fell 12/32 in price
to yield 1.5942%, 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 cause
the world's biggest economy to overheat and lead to runaway
inflation.
U.S. Treasury Secretary Janet Yellen said on Monday that
President Joe Biden's coronavirus aid package will provide
enough resources to fuel a "very strong" U.S. economic recovery,
and noted "there are tools" to deal with inflation. Analysts largely expect an acceleration in inflation, 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, the Dow advanced while the Nasdaq shed
nearly 2%. The technology sector and other richly valued names
have been highly susceptible to rising rates.
The Dow Jones Industrial Average .DJI rose 446.5 points,
or 1.42%, to 31,942.8, the S&P 500 .SPX gained 4.11 points, or
0.11%, to 3,846.05 and the Nasdaq Composite .IXIC dropped
211.69 points, or 1.64%, to 12,708.46.
Shares of banks and automakers lifted European shares as
investors continued to move into economy-linked sectors on hopes
of a solid rebound from the coronavirus downturn.
The pan-European STOXX 600 index .STOXX rose 2.10% and
MSCI's gauge of stocks across the globe .MIWD00000PUS shed
0.13%.
U.S. 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 growth in the
first quarter. On foreign exchange markets, the dollar index =USD shot up
to a high of 92.341, its highest since Nov. 24.
The dollar index =USD rose 0.465%, with the euro EUR=
down 0.52% to $1.1855.
The Japanese yen weakened 0.51% versus the greenback at
108.86 per dollar, while sterling GBP= was last trading at
$1.3837, down 0.03% on the day.
The jump in yields and the dollar has weighed on gold, which
offers no fixed return.
Spot gold XAU= dropped 1.0% to $1,683.69 an ounce after
hitting a nine-month low of $1,678.40.
U.S. gold futures GCv1 settled 1.2% down at $1,678.
Oil prices rose after attacks on Saudi Arabian oil sites and
the stimulus passage, before reversing course to trade lower on
the day. U.S. crude futures CLc1 settled down $1.04, or 1.57%, at
$65.05 per barrel. Brent crude futures LCOc1 settled at $68.24
per barrel, down $1.12 or 1.61%.
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2021 asset performance http://tmsnrt.rs/2yaDPgn
World FX rates in 2021 http://tmsnrt.rs/2egbfVh
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