* CPI data shows underlying inflation muted
* Treasury yields slide on tepid 10-year auction demand
* Wall Street builds on Tuesday rally
* European stocks hover near pre-pandemic highs
* Gold hits one week high as bond yields ease (Updates prices, comment; adds 10-year Treasury auction)
By Chuck Mikolajczak and Matt Scuffham
NEW YORK, March 10 (Reuters) - A gauge of global stocks climbed for a second day on Wednesday to its highest level in a week after a report on U.S. consumer prices calmed concerns about inflation, while the dollar retreated further from a 3-1/2 month high.
Economic data from the Labor Department said its consumer price index rose 0.4% in February in line with expectations, after a 0.3% increase in January. Core CPI, which excludes the volatile food and energy components, edged up 0.1%, just shy of the 0.2% estimate, after being unchanged the prior two months. analysts largely expect a hike in inflation as vaccine rollouts lead to a reopening of the economy, worries persist that additional stimulus in the form of a $1.9 trillion coronavirus relief package set to be signed by U.S. President Joe Biden could lead to an overheating of the economy.
The House of Representatives gave final approval on Wednesday to the bill, one of the largest economic stimulus measures in U.S. history. (inflation) is not the biggest deal as long as it is kept in check," said Ross Mayfield, investment strategist at Baird in Louisville, Kentucky. "Higher rates are not really the boogeyman, more the speed of it over the last month or two."
U.S. Treasury yields slid after an auction of benchmark 10-year notes that showed tepid demand with lower-than-average bid-to-cover ratio.
The high yield was 1.523%, a little higher compared with the "when-issued" or expected level at the bid deadline of 1.520%. The bid-to-cover ratio was 2.38, compared with the reopening average of 2.41, according to BMO Capital. 10-year notes US10YT=RR last yielded 1.5143%, from 1.544% late on Tuesday.
Investors will now eye an auction of 30-year debt on Thursday, seeking to cover massive shorts. A weak 7-year auction in late February helped fuel inflation concerns and sent yields higher. fall in the 10-year yield after the auction wasn't enough to help the tech-heavy Nasdaq, which lagged both the Dow and S&P 500 after its strong move on Tuesday, as investors stayed with names expected to benefit from the economic reopening like financials.
The Dow Jones Industrial Average .DJI rose 506.47 points, or 1.59%, to 32,339.21, the S&P 500 .SPX gained 33.17 points, or 0.86%, to 3,908.61 and the Nasdaq Composite .IXIC added 34.05 points, or 0.26%, to 13,107.87.
Europe's main index hovered near pre-pandemic highs.
The pan-European STOXX 600 index .STOXX closed up 0.4% after a rally in technology stocks on Tuesday pushed the benchmark to its highest level since February 2020.
The MSCI world equity index .MIWD00000PUS rose 4.88 points or 0.74 percent, to 667.87.
Gold erased earlier losses to hit a one-week high on Wednesday, as U.S. Treasury yields eased.
Spot gold prices XAU= rose $8.2 or 0.48 percent, to $1,723.56 an ounce.
U.S. gold futures GCv1 settled 0.3% up at $1,721.80.
The dollar moved lower for a second day following the economic data.
The dollar index =USD fell 0.167%, with the euro EUR= up 0.17% to $1.1918.
Oil prices resumed their climb after two days of declines, extending gains after the Energy Information Administration reported a bigger-than-expected storage build. crude futures CLc1 settled at $64.44 per barrel, up 43 cents or 0.67%. Brent crude futures LCOc1 settled at $67.90 per barrel, up 38 cents or 0.56%.
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http://tmsnrt.rs/2jvdmXl Global currencies vs. dollar YTD
http://tmsnrt.rs/2egbfVh Emerging markets in 2021
http://tmsnrt.rs/2ihRugV MSCI All Country World Index Market Cap
http://tmsnrt.rs/2EmTD6j
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