GLOBAL MARKETS-European shares strengthen, but tech stocks under pressure

* Reuters Live Markets blog: LIVE/
* Graphic: Global asset performance http://tmsnrt.rs/2yaDPgn
* Graphic: World FX rates http://tmsnrt.rs/2egbfVh

LONDON, Feb 24 (Reuters) - European shares opened generally
higher on Wednesday but world shares remained in the red after a
weak Asian session, even after Fed Chair Jerome Powell pushed
back against inflation fears.
Falling tech stocks pulled Asian markets lower overnight, as
recent gains in U.S. Treasury yields put lofty valuations under
pressure. In his testimony before the U.S. Senate, Federal Reserve
Chair Jerome Powell did not seem too worried about rising
yields, telling Congress they were a statement on the market's
confidence in the pandemic recovery. The 10-year U.S. Treasury yield edged back down below its
recent one-year high, although it rose as European markets
opened US10YT=RR .
"Powell's comments reinforce our view that the increase in
inflation expectations is most likely transitory and that higher
Treasury yields primarily reflect optimism over the economic
recovery and the reflation trade," wrote UBS chief investment
officer for global wealth management, Mark Haefele, in a note to
clients.
"Investors should expect an extended period in which
interest rates remain below inflation."
Europe's STOXX 600 rose in early trading, up 0.1% at 0843
GMT .STOXX , Germany's DAX was up 0.4% .GDAXI , but London's
FTSE 100 was down 0.7% .FTSE .
The MSCI world equity index .MIWD00000PUS , which tracks
shares in 49 countries, was down 0.4%, having lost 2.3% since it
last hit an all-time high on Feb. 16.
U.S. futures pointed to a weaker open for Wall Street
EScv1 , with futures for the tech-heavy Nasdaq in decline for
the seventh consecutive day NQcv1 . Tech stocks are particularly sensitive to rising yields
because their value rests heavily on earnings in the future,
which are discounted more deeply when bond returns go up.
Bitcoin recovered somewhat, up 3.3% at around $50,500 at
0846 GMT, but was still down 13.5% from the all-time high above
$58,000 it reached on Sunday BTC=BTSP .
"I suspect we are in a bubble in certain places, that
stimulus cheques will provide more fire to that at some point
but that risk assets are going to be constantly buffeted by the
risk of higher yields and inflation regardless of whether it has
any structural roots or not," wrote Deutsche Bank strategist Jim
Reid in a note to clients.
One year on from the start of the COVID-19 market crash,
financial market participants were generally upbeat about the
prospect of vaccine rollouts, lockdowns ending and economies
re-opening.
Strong exports and solid construction activity helped the
German economy to grow by a stronger-than-expected 0.3% in the
final quarter of last year, the Federal Statistics Office said
on Wednesday, revising up an earlier estimate. U.S. consumer confidence increased in February and Britons
rushed to book foreign holidays after the government laid out
plans to relax restrictions. But EU government leaders will
agree on Thursday to maintain curbs on non-essential travel
within the bloc. The dollar was down 0.1% versus a basket of currencies at
0849 GMT =USD , while euro-dollar was slightly up at $1.2165
EUR=EBS .
The benchmark 10-year German Bund was a touch lower at
-0.325% DE10YT=RR .
Elsewhere, oil prices slipped after industry data showed a
surprise build in U.S. crude stocks last week. Brent crude futures have still gained 26% so far in 2021
CLOc1 and U.S. West Texas Intermediate (WTI) crude futures
have risen 27% CLc1 .
Spot gold rose, hovering just below the previous session's
one-week high XAU= . <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Emerging markets http://tmsnrt.rs/2ihRugV
Global asset performance http://tmsnrt.rs/2yaDPgn
Up and away: global bond yields on the rise https://tmsnrt.rs/3kesTqW
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