GLOBAL MARKETS-Stocks gain after Trump auto-tariff delay, weak data pressures yields

* Wall Street, European shares rebound after initial falls
* Trump set to delay auto tariffs decision by up to 6 months
* U.S., German yields fall after weak data
* Oil rises on Middle East tension, shrugs off U.S. crude
build

(Updates with close of U.S. trading)
By Lewis Krauskopf
NEW YORK, May 15 (Reuters) - U.S. and European stock indexes
gained on Wednesday after news that U.S. President Donald Trump
planned to delay tariffs on auto imports, offsetting earlier
pressure on equities from weak U.S. and Chinese economic data
that helped depress bond yields.
Trump is expected to delay a decision on tariffs on imported
cars and parts by up to six months, three administration
officials told Reuters. Fears about an escalating
global trade war, particularly following a spike in U.S.-China
tensions, have rattled markets over the past week.
Meanwhile, U.S. Treasury Secretary Steven Mnuchin said he
will likely travel to China soon to continue talks as Washington
and Beijing seek to resolve their months-long trade war.
Major U.S. and European stock indexes ended higher after
falling earlier in the session.
On Wall Street, the Dow Jones Industrial Average .DJI rose
115.97 points, or 0.45%, to 25,648.02, the S&P 500 .SPX gained
16.55 points, or 0.58%, to 2,850.96 and the Nasdaq Composite
.IXIC added 87.65 points, or 1.13%, to 7,822.15.
"The market was selling but rebounded," said Chuck Carlson,
chief executive officer at Horizon Investment Services in
Hammond, Indiana. "It's symptomatic of a market that's in
short-term mode right now and what's driving that right now is
trade."
The pan-European STOXX 600 index .STOXX rose 0.46%.
Europe's autos and suppliers index .SXAP jumped 2.0%.
MSCI's gauge of stocks across the globe .MIWD00000PUS
gained 0.49%.
The positive trade developments lifted risk sentiment that
had been dampened earlier in the session by weak economic data.
China reported surprisingly weaker growth in retail sales
and industrial output for April. In the U.S., retail sales
unexpectedly fell in April as households cut back on purchases
of motor vehicles and a range of other goods, while other data
showed a drop in industrial production last month. U.S. Treasury yields fell, with the two-year yield hitting
its lowest in 15 months after the disappointing U.S. data
raised expectations the Federal Reserve will cut interest rates
this year. Benchmark 10-year notes US10YT=RR last rose 14/32 in price
to yield 2.3715%, from 2.419% late on Tuesday.
Yields on German bonds also sank deeper into negative
territory. "You have a tale of two markets," said Willie Delwiche,
investment strategist at Baird in Milwaukee. "U.S. stocks,
particularly U.S. large-cap stocks, have rallied in response to
... trade-related headlines. But the curious thing is that the
bond market has not responded."
"It suggests to me that there is cause for some global
concern in terms of the economy," Delwiche said.
The dollar index .DXY , which measures the greenback
against a basket of six major currencies, rose 0.06%, with the
euro EUR= down 0.04% to $1.1199. Oil futures rose as worries that rising tensions in the
Middle East could hit global supplies overshadowed an unexpected
build in U.S. crude inventories. U.S. crude CLcv1 rose 0.4% to settle at $62.02 a barrel,
while Brent LCOcv1 settled at $71.77, up 0.7%. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh
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