* Deaths from COVID-19 reached half a million on Sunday
* Sterling drops on infrastructure funding concerns
* Boeing (NYSE:BA) boosts industrial stocks in the U.S. (Updates prices, changes comment)
By Rodrigo Campos
NEW YORK, June 29 (Reuters) - A gauge of stocks across the world rose on Monday, led by a rebound on Wall Street, even as rising COVID-19 cases threaten to stall the recovery of the world's largest economy.
Contracts to buy U.S. previously owned homes rose by the highest percentage on record in May. But they remained below their February level and were down compared with May 2019, which also kept alive expectations for even more economic stimulus. market believes that the (Federal Reserve) has its back," said Sam Stovall, chief investment strategist at CFRA Research in New York.
"If things get really bad, the Fed will step in with additional monetary easing and basically reach into their bag of tricks to do whatever they need to support the market."
Confirmed COVID-19 cases worldwide rose past 10 million and deaths surpassed 500,000 on Sunday. The relentless spread of the new coronavirus in the United States, Latin America and elsewhere curbed optimism over the global economy and raised worries that some reopening plans will be delayed.
A rally in Boeing shares BA.N after U.S. authorities confirmed that 737 MAX certification flights could start Monday gave life to the Dow industrials .DJI , while factory- and materials-heavy sectors of the S&P 500 .SPX boosted the benchmark index.
The Dow Jones Industrial Average .DJI rose 498.99 points, or 1.99%, to 25,514.54, the S&P 500 .SPX gained 38.27 points, or 1.27%, to 3,047.32 and the Nasdaq Composite .IXIC added 100.26 points, or 1.03%, to 9,857.48.
The pan-European STOXX 600 index .STOXX rose 0.44% and MSCI's gauge of stocks across the globe .MIWD00000PUS gained 0.59%.
Emerging market stocks lost 0.53%. MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS closed 0.95% lower, while Japan's Nikkei futures NKc1 rose 0.36%.
It is an important week for U.S. data, with the ISM manufacturing index on Wednesday and monthly payrolls on Thursday, moved up a day due to observance of the Independence Day holiday on Friday. Fed Chair Jerome Powell is testifying on Tuesday.
Bill Merz, head of fixed income research at U.S. Bank Wealth Management in Minneapolis, said he expected small changes for long-term yields, noting that Treasuries may be "one of the least-interesting markets for the rest of the year" due to the Fed's influence on the short end of the curve.
Benchmark 10-year notes US10YT=RR last fell 2/32 in price to yield 0.6446%, from 0.638% late on Friday.
In currency markets, Sterling fell against both the dollar and euro as investors focused on how Britain's government will pay for its planned infrastructure push, while Brexit-related risks kept pressure on the pound. GBP= was last trading at $1.2289, down 0.36% on the day after falling nearly 0.7% earlier.
The dollar index =USD rose 0.097%, with the euro EUR= up 0.08% to $1.1226.
The Japanese yen weakened 0.54% versus the greenback at 107.74 per dollar.
U.S. crude CLc1 recently rose 3.14% to $39.70 per barrel and Brent LCOc1 was at $41.78, up 1.85% on the day.
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