GLOBAL MARKETS-Stocks gain with U.S. rate-cut bets, Grassley comments; bond prices ease

* U.S. stocks climb in afternoon trading
* 10-year Treasury prices slip after Grassley comments on
trade
* Oil slides; data shows surprise build in U.S. crude
stockpiles

(Updates with European markets close and U.S. oil settles
lower)
By Caroline Valetkevitch
NEW YORK, June 5 (Reuters) - Major world stock markets rose
and longer-dated U.S. Treasury prices dipped on Wednesday as a
U.S. senator predicted the United States will not impose tariffs
on Mexican imports, while hopes of a U.S. interest rate cut also
bolstered equities.
Republican Senator Chuck Grassley predicted that the United
States and Mexico would be able to strike a deal to avert
tariffs U.S. President Donald Trump has threatened to impose on
Mexican imports. A flare-up in trade tensions between the United States and
China hurt world stocks in May and triggered fears of an
impending recession.
Comments from Federal Reserve Chairman Jerome Powell and
other Fed officials this week helped limit equity market losses
as they warned the trade war may force them to respond,
prompting investors to price in possible rate cuts. "The Fed is clearly leaning in the direction that it will
cut rates if it sees anymore slowing in the economy, and there
is that hope that we can avoid putting tariffs on Mexico so that
is a positive," said Art Hogan, chief market strategist at
National Securities in New York.
Underscoring concerns over growth was a report by U.S.
payrolls processor ADP Wednesday that showed U.S. private
employers added 27,000 jobs in May, well below economists'
expectations and the smallest monthly gain in more than nine
years. Interest rate futures show the U.S. central bank will start
cutting rates as soon as next month, with as many as three rate
cuts priced by year-end.
The Dow Jones Industrial Average .DJI rose 188.81 points,
or 0.75%, to 25,520.99, the S&P 500 .SPX gained 19.74 points,
or 0.70%, to 2,823.01 and the Nasdaq Composite .IXIC added
37.11 points, or 0.49%, to 7,564.23.
MSCI's broad gauge of stocks across the globe
.MIWD00000PUS was on track for a third day of gains, rising
0.6%. The pan-European STOXX 600 index .STOXX rose 0.38%.
In the U.S. Treasuries market, benchmark 10-year notes
US10YT=RR last fell 3/32 in price to yield 2.1296%, from
2.121% late on Tuesday. Yields held above 2.061% reached on
Monday, which was their lowest level since September 2017.
Earlier, Germany's 10-year bond yield reached a record low
and Italian debt held on to this week's gains as investors
ramped up their bets on a generous loan package for banks in the
euro zone as well as a U.S. rate cut. GVD/EUR
The U.S. dollar was higher in afternoon trading, reversing
earlier losses.
The dollar index .DXY , which tracks the greenback versus a
basket of six currencies, rose 0.21 points or 0.22 percent, to
97.282. The yen JPY= was last up 0.23 percent, at 108.3900 per
dollar.
Oil prices resumed their recent slide, extending losses
after data showing a surprise build in U.S. crude stockpiles.
U.S. crude CLcv1 fell 3.37% to settle at $51.68 a barrel.
Gold prices jumped to their highest in 15 weeks as the U.S.
rate cut bets encouraged investors to flock toward bullion. Spot
gold XAU= was up 0.3% to $1,329.41 per ounce. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
World FX rates in 2019 http://tmsnrt.rs/2egbfVh
MSCI All Country Wolrd Index Market Cap http://tmsnrt.rs/2EmTD6j
Emerging markets in 2019 http://tmsnrt.rs/2ihRugV
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