GLOBAL MARKETS-U.S. stocks rebound after rout, bond yields dip

(Updates to New York close)
* US stocks bounce following Wednesday's sell-off
* Investors shrug off inflation fears for now
* Benchmark Treasury yields pull back
* Graphic: Global asset performance http://tmsnrt.rs/2yaDPgn
* Graphic: World FX rates http://tmsnrt.rs/2egbfVh

By Koh Gui Qing
NEW YORK, May 13 (Reuters) - U.S. shares rebounded on
Thursday after falling for three consecutive days and benchmark
Treasury yields dipped, as investors snapped up stocks that
would benefit from an economic recovery and shrugged off worries
about rising prices, for now.
After posting their biggest slump in at least 11 weeks on
Wednesday, U.S. shares bounced back as investors flush with cash
looked past concerns that accelerating inflation may prompt
interest rate hikes sooner, and deployed their funds once more.
So intent were investors on leaving inflation worries aside
that financial markets barely responded to Thursday's data,
which showed U.S. producer prices posting their biggest annual
gain since 2010 in April. "It's rebound Thursday," said John Augustine, chief
investment officer at Huntington Private Bank, which manages $20
billion in assets. "Given the money on the sidelines, investors
are going to be coming back in."
Still, Augustine said investors should redeploy their funds
in a measured way as "inflation concerns are not going away".
The Dow Jones Industrial Average .DJI ended the day up
1.3%, the S&P 500 .SPX rose 1.2% and the Nasdaq Composite
.IXIC gained 0.7%.
Gains were led by shares in small-cap companies .RUT , chip
makers .SOX and transportation providers .DJT - businesses
that stand to gain as the United States emerges from the
pandemic recession. .N
The bounce in U.S. stocks lifted the MSCI world equity index
.MIWD00000PUS , which tracks 50 countries, by 0.3%.
Wall Street had tumbled earlier this week after data showed
U.S. consumer prices unexpectedly jumped by the most in almost
12 years in April.
Some investors now worry that quickening price pressures
could lead the U.S. Federal Reserve to tighten monetary policy
sooner than expected, reducing its supply of cheap money that
has propelled financial markets higher.
For now, however, inflation woes took a backseat.
Benchmark 10-year Treasury yields US10YT=RR , which spiked
7 basis points overnight in the biggest daily rise in two
months, fell by nearly 4 basis points to 1.6556% as investors
took a breather.
Benchmark two-year Treasury yields US2YT=RR also pulled
back to 0.1569%. US/
Against a basket of major currencies, the dollar =USD was
steady at 90.718, largely holding on to gains eked out on
Wednesday, when expectations of rate hikes burnished the
currency's appeal.
A firm dollar capped gains in the euro EUR=EBS , which
edged up 0.1% to $1.20805. USD/
The pullback in Treasury yields helped gold to recoup some
of its previous day's losses, when rising bond yields dampened
the allure of non-yielding bullion. Spot gold XAU= climbed
0.6% from a one-week low to $1,826.71 per ounce. GOL/
A recent rally in oil prices also paused on Thursday as
investors turned their attention to the coronavirus crisis in
India, and as the top U.S. fuel pipeline network resumed
operations. O/R
Brent crude LCOc1 slumped 3.4% to $66.98 a barrel, while
U.S. West Texas Intermediate crude CLc1 lost 3.5% to $63.78 a
barrel.
Among cryptocurrencies, bitcoin BTC=BTSP , which tumbled
13% overnight when Elon Musk said Tesla Inc TSLA.O would stop
accepting it as payment because of its high energy use, skidded
again on Thursday following reports that the U.S. Justice
Department was investigating crypto exchange Binance.
By Thursday evening, bitcoin had dropped 0.7% to $48.965.

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Asia stock markets https://tmsnrt.rs/2zpUAr4
Asia-Pacific valuations https://tmsnrt.rs/2Dr2BQA
U.S. core inflation https://tmsnrt.rs/2RNcYWC
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