* Euro STOXX 600 up 0.3%
* Bonds across world fall, taking cue from U.S. Treasuries
* Dollar languishes near 3-year low
* Commodity, finance, chipmakers lead broad equity gains
* U.S. futures higher
By Tom Wilson and Tom Westbrook
LONDON/SINGAPORE, Jan 7 (Reuters) - Bonds licked their wounds and stocks rose on Thursday as investors bet Democrat control of the U.S. Congress would enable President-elect Joe Biden to borrow and spend heavily, with a bruised dollar hovering near its lowest in almost three years.
U.S. Treasuries extended their steepest selloff in months after Democrat victories in two Georgia races handed them narrow control of the Senate, bolstering President-elect Joe Biden's power to pass his agenda. Euro STOXX 600 .STOXX gained 0.3%, with indexes in Frankfurt .GDAXI and Paris .FCHI up 0.4% and 0.6% respectively. Growth-linked sectors from energy .SX7E to miners .SXPP rallied on the prospects of more U.S. stimulus.
The MSCI world equity index .MIWD00000PUS , which tracks shares in almost 50 countries, rose 0.3%.
Earlier, MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS rose 0.6% and Japan's Nikkei .N225 hit its highest since 1990.
Even after risk sentiment was earlier knocked by images of President Donald Trump's supporters storming Capitol Hill to attempt to overturn his election defeat, S&P 500 futures ESc1 rose 0.6% as order was restored and Congress returned to work.
It quickly became clear that objections from pro-Trump Republican lawmakers to Biden's victory in battleground states would be rejected overwhelmingly, including by most Republicans. stocks it will be a net positive, for other assets classes it will be different," said Olivier Marciot, a portfolio manager at Unigestion said of the Democrat victory.
"The bond moves yesterday were something we hadn't seen for a long time. The case is for reflation."
Wednesday's bond selloff pushed the yield on benchmark 10-year U.S. Treasuries US10YT=RR , which rises when prices fall, over 1% for the first time since March. It rose as high as 1.0660% on Thursday. US/
Euro zone government bond yields also edged higher, with Germany's 10-year Bund yield up slightly to -0.55%. Japanese government bond prices had also slipped, taking cues from the U.S. DOLLAR
The ramifications of the Democrat victory played out in currency markets, too.
The dollar had sunk on the Georgia results to a near-three year low against a basket of six major currencies =USD , with traders betting growing U.S. trade and budget deficits would weigh on the greenback. On Thursday it bounced 0.3% to 89.529.
Against the euro EUR= it hovered near an almost three-year low of $1.2349, and also languished near recent multi-year troughs against the Aussie AUD=D3 , kiwi NZD=D3 and Swiss franc CHF= .
Still, some analysts said rising bond yields may help the dollar's fortunes.
"Higher Treasury yields should benefit the dollar against the euro and the yen," said Masafumi Yamamoto, chief currency strategist at Mizuho Securities in Tokyo.
"However, the dollar will remain weaker against commodity currencies like the Aussie and emerging market currencies."
Other risk-on assets climbed.
Copper, a barometer for global growth, gained 0.3% MCU3=LX to hover near an 8-year high.
In Asia, miners Rio Tinto (LON:RIO) RIO.AX and BHP BHP.AX earlier surged to all-time peaks, while chipmakers Samsung 005930.KS and SK Hynix 000660.KS drove South Korean stocks .KS11 to a record high.
Oil prices held around a 10-month high, basking in the afterglow of a production cut promised by Saudi Arabia. Brent crude futures LCOc1 were last up 0.7% to $54.68 a barrel.
Gold XAU= was steady at $1,921 an ounce, and bitcoin BTC=BTSP firm after hitting a fresh record high of $37,800. The cryptocurrency has soared over a quarter already this month after almost quadrupling last year.
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http://tmsnrt.rs/2jvdmXl Global currencies vs. dollar
http://tmsnrt.rs/2egbfVh Emerging markets
http://tmsnrt.rs/2ihRugV MSCI All Country Wolrd Index Market Cap
http://tmsnrt.rs/2EmTD6j
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