Global stocks rally on Amazon's rebound, dollar gains

By Herbert Lash

NEW YORK (Reuters) - A gauge of global equity markets edged higher on Tuesday on a rebound in Amazon.com shares and as a still bright earnings outlook offset a sombre mood among investors, while the U.S. dollar rose on easing concerns over a China-U.S. trade spat.

Oil prices rose after their biggest one-day fall in almost a year on Monday, though higher Russian output and Saudi Arabia possibly cutting selling prices dragged on crude trading.

Investors remained cautious after China said Sunday it would raise tariffs on 128 U.S. products, threatening a deeper dispute between the world's two biggest economies and the potential impact of a trade standoff on global growth.

U.S. Treasury yields and benchmark German bunds rose as stocks on Wall Street firmed and as investors looked to Friday's closely watched U.S. employment report for March.

U.S. debt yields had dropped to two-month lows on Monday, boosted by safe-haven buying amid the rout in technology shares.

MSCI's gauge of stocks across the globe gained 0.45 percent as stocks on Wall Street staged a late-day rally on the turn-around in Amazon shares, which closed 1.46 percent higher.

Earlier in Europe, the pan-regional FTSEurofirst 300 index of leading shares closed down 0.45 percent.

After being shut for Easter Monday and feeling the rout's impact a day later, Europe's main bourses in London <.FTSE>, Paris <.CAC40> and Frankfurt <.GDAXI> closed lower.

Tech stocks, following Monday's U.S. downdraft, remained a pressure point in Europe <.SX8P> after U.S. President Donald Trump renewed his criticism of Amazon.

Reports that Apple intended to make more of its own parts slammed European chipmakers such as AMS and STMicroelectronics .

AMS fell 2.28 percent and STM 2.97 percent.

The S&P 500 Information Technology index <.SPLRCT> has tumbled in recent weeks, ending Monday down 9.8 percent from a March 12 closing record. It rose 1 percent on Tuesday.

The fundamental picture of solid global growth and strong corporate earnings hasn't changed that much, though a White House that was market friendly in 2017 has turned less so in 2018, adding a new twist to markets, said Larry Hatheway, chief economist at GAM Investment Management in Zurich.

"If equities are going to find a solid foundation to recover some of the losses they suffered over the last two months, it's probably going to be on the basis that companies can still demonstrate earnings and fundamental reasons their earnings story is intact," Hatheway said, speaking in New York.

The Dow Jones Industrial Average rose 389.17 points, or 1.65 percent, to 24,033.36. The S&P 500 gained 32.57 points, or 1.26 percent, to 2,614.45 and the Nasdaq Composite added 71.16 points, or 1.04 percent, to 6,941.28.

Spotify shares began trading on the New York Stock Exchange with an opening price of $165.90 per share, nearly 26 percent above the reference price of $132 a share set by the NYSE late on Monday.

Spotify later pared gains but still closed 12.9 percent higher at $149.01.

The dollar rebounded from an early fall on concerns about U.S.-China trade tensions.

The dollar index , tracking it against a group of major currencies, rose 0.14 percent, with the euro down 0.26 percent to $1.2268. The Japanese yen weakened 0.69 percent versus the greenback at 106.61 per dollar.

Asia's shares had stumbled overnight, though their moves had been small compared to Wall Street where the S&P 500 closed below its 200-day moving average for the first time since Britain's 2016 vote to leave the European Union.

The slight recovery in risk appetite meant U.S. Treasuries, German Bunds and UK Gilts all saw a bit of selling too in Europe. Yields on 10-year notes were all off two- to three-month lows.

Benchmark 10-year U.S. Treasury notes last fell 15/32 in price to yield 2.7880 percent.

U.S. crude rose 50 cents to settle at $63.51 a barrel and Brent settled up 48 cents at $68.12.

(Reporting by Herbert Lash; Editing by Bernadette Baum and James Dalgleish)