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

(Corrects increase in Brent crude price in paragraph 15)
* U.S. Treasury yield curve steepens 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

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 rose
0.37%, with U.S. equities touching record highs following the
release of prepared remarks for Powell's testimony before the
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.
Minutes released from the Fed's June meeting struck a
similar tone as Powell's testimony. Several of the central
bank's policymakers said interest rates should come down to
soften the blow of a U.S.-China trade war and to firm up
inflation. After Powell's remarks and the Fed's minutes, 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 28.7%, according to CME
Group's FedWatch tool.
"It's what the market wanted to hear," said J.J. Kinahan,
chief market strategist at TD Ameritrade in Chicago. "Many
people thought the jobs report - one data point - would all of a
sudden change how the Fed was thinking. But the Fed tends to
operate on trends, not data points."
Yields on short-dated U.S. Treasuries, which had ticked
higher in recent sessions after Friday's stronger-than-expected
employment data, fell on Powell's remarks. The two-year Treasury
yield, a proxy for market sentiment about interest rate policy,
was last 7.3 basis points lower at 1.8317%. However, yields on 10-year and 30-year Treasuries moved
higher to steepen the yield curve which had flattened over the
past few sessions. Benchmark 10-year Treasury notes US10YT=RR
last fell 3/32 in price to yield 2.0665%, from 2.056% late on
Tuesday.
Following Powell's remarks, the dollar fell against the euro
and the yen. The dollar index .DXY , tracking the greenback
against six major currencies, was last 0.40% lower. The yen was last 0.39% stronger against the dollar at
108.42, while the euro rose 0.42% against the greenback to
$1.1253.
"The easing of the dollar is a good thing overall," said
Keith Lerner, chief market strategist at SunTrust Advisory
Services in Atlanta. "That's a positive for international
markets and for financial conditions."
The Dow Jones Industrial Average .DJI rose 68.87 points,
or 0.26%, to 26,852.36, the S&P 500 .SPX gained 11.04 points,
or 0.37%, to 2,990.67 and the Nasdaq Composite .IXIC added
46.30 points, or 0.57%, to 8,188.03.
In Europe, the STOXX 600 .STOXX briefly turned positive
following Powell's comments but ended 0.20% lower.
In commodity markets, oil prices surged 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 settled up $2.85, or 4.44%, to
$67.01 a barrel, while U.S. West Texas Intermediate crude
futures CLc1 settled up $2.60, or 4.5%, to $60.43 a barrel.
Spot gold XAU= added 1.2% to $1,414.19 an ounce as the
dollar fell. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
GRAPHIC-Asia stock markets https://tmsnrt.rs/2zpUAr4
GRAPHIC-Asia-Pacific valuations https://tmsnrt.rs/2Dr2BQA
GRAPHIC-Bond yields take the plunge https://tmsnrt.rs/2G4F7jg
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>