Oil rallies on output bets; U.S. yields, dollar steady

By Rodrigo Campos

NEW YORK (Reuters) - Oil prices jumped nearly 4 percent on Tuesday on bets OPEC members will agree to cut output while stocks edged higher, led by technology shares that had fallen recently.

The U.S. dollar index held above the 100 level and touched a fresh 11-month high, and Treasuries prices were little changed with yields near multi-month highs.

The S&P 500 traded higher, led by recent decliners including Apple , Facebook and Alphabet .

Bank stocks were the largest weight on Wall Street. They had been recent gainers on the expectation that the incoming Donald Trump administration would bring in less regulation and spark inflation through higher spending.

Tech stocks had been sold off in favour of sectors with lower valuations on the expectation of a spike in economic growth.

"We're sort of poised for a little bit of a pullback here as people reassess what the new administration is likely to accomplish," said Scott Brown, chief economist at Raymond James in St. Petersburg, Florida.

"The uncertainty is going to hang over the markets for a while. So we may see a lot of this back and forth."

The Dow Jones industrial average fell 40.06 points, or 0.21 percent, to 18,828.63, the S&P 500 gained 7.21 points, or 0.33 percent, to 2,171.41 and the Nasdaq Composite added 42.04 points, or 0.81 percent, to 5,260.44.

The pan-European FTSEurofirst 300 index gained 0.27 percent, while MSCI's gauge of stocks across the globe ticked up 0.3 percent.

OIL JUMPS, GREENBACK PAUSES

Oil producers in the Organization of the Petroleum Exporting Countries are due to meet later this month to agree to limit output, and hopes on a deal boosted prices. An outline deal was reached in September but negotiations on the detail are proving difficult, officials say.

U.S. crude was up 4.3 percent at $45.16 a barrel and Brent last traded at $46.16, up 3.9 percent on the day.

"Clearly the market is now seeing increased chances of an OPEC production cut," Commerzbank analysts said in a note. "There is doubtless considerable pressure to take action, as the oversupply will not reduce itself."

Copper , which rallied nearly 20 percent over the three weeks to Friday, fell 1.2 percent to $5,495.00 a tonne.

The dollar index was in and out of negative territory for the day but remained near the 100 level and touched its highest since December.

The greenback had support from data showing U.S. retail sales rose more than expected in October, pointing to sustained economic strength that could allow the Federal Reserve to raise interest rates next month.

The euro edged down 0.05 percent to $1.0729, having strengthened as far as $1.0816 while the yen weakened 0.5 percent to 108.92 per dollar.

Benchmark 10-year notes last rose -2/32 in price to yield 2.2295 percent, down from 2.222 percent on Monday.

Spot gold gained 0.4 percent to $1,224.46 an ounce. U.S. gold futures rose 0.2 percent to $1,224.20 an ounce.

(Reporting by Rodrigo Campos; additional reporting by Tanya Agrawal and Anya George Tharakan in Bangalore and Devika Krishna Kumar in New York)