* Wall St extends gains for third day * Fed bond buying could be more aggressive than new timeline - Dudley * Precious metals rebound, oil extends gains By Angela Moon NEW YORK, June 27 Global equity markets and bonds rose on Thursday, showing further signs of stabilizing from a dramatic selloff as concerns receded that the Federal Reserve would begin to unwind its stimulus efforts earlier than expected. U.S. Treasuries, which were hit the hardest by Fed Chairman Ben Bernanke's comments last week about when the U.S. central bank would begin paring back its huge bond purchase program, showed more signs of recovery with prices rising further after a sale of seven-year government debt. Wall Street extended its gains for a third session after a Fed official reiterated that any change in monetary policy will depend on data and not the calendar. A number of upbeat U.S. economic reports on the housing sector and consumer spending further eased worries over whether the world's biggest economy could withstand the winding down of the Fed's monetary stimulus. New York Fed President William Dudley stressed in a speech that the newly adopted timeline for reducing the pace of bond buying depends not on calendar dates but on the economic outlook, which remains quite unclear. "The Fed had to be shocked at how much of a move Bernanke's testimony generated ... so now it is trying to alter expectations," said Nick Sargen, chief investment officer at Fort Washington Investment Advisors in Cincinnati. Equities have been volatile ever since Bernanke said the Fed's $85 billion a month bond-buying program, credited with fueling the market's 13 percent jump in 2013, would be reined in earlier than expected if economic conditions improve. The benchmark S&P 500 dropped as much as 4.8 percent in the days following a June 19 statement from Fed policy-makers. In Treasuries, the benchmark 10-year note rose 20/32 in price to yield 2.468 percent, compared to a price gain of 12/32 shortly before the seven-year debt sale. The 30-year bond rose 28/32 in price to yield 3.532 percent after the auction, in which the Treasury sold $29 billion of seven-year notes at a high yield of 1.932 percent, the highest yield since July 2011. MARKETS RECOVER European shares ended higher, with the FTSEurofirst 300 index of top European shares rallying for a third straight day to close 0.7 percent higher at 1,157.42. The index, still down nearly 8 percent since late May, managed to cross back above a major resistance level representing the index's 200-day moving average, sending a positive technical signal. MSCI's world share index rose 1 percent after touching its highest in a week. The Dow Jones industrial average was up 106.90 points, or 0.72 percent, at 15,017.04. The Standard & Poor's 500 Index was up 10.83 points, or 0.68 percent, at 1,614.09. The Nasdaq Composite Index was up 24.28 points, or 0.72 percent, at 3,400.50. Since the sharp decline last week, the S&P 500 has rebounded to climb 1.9 percent over the past two sessions as economic data and comments from Fed officials quelled fears of an earlier-than-expected pullback of monetary stimulus to spur the economy. With the yield on benchmark 10-year U.S. government debt appearing to have stabilized at around 2.5 percent, euro zone bonds from Germany to Greece were able to claw back some of the ground lost during the recent global selloff. Reflecting the recent rise in yields generally over the last few weeks, Italy paid its highest rate since March at a 5 billion euro auction of 10- and 5- year debt. But healthy demand boosted its bonds to top the list of euro zone periphery performers. Markets also focused on a deal hammered out by European authorities overnight designed to shift the burden of paying for bank bailouts away from taxpayers, although economists' opinions on the deal were mixed. In other assets, crude oil futures rose for a fourth straight session on Thursday, gaining over $1 a barrel, while gold reversed earlier gains to trade down. Spot gold was down $21.1 to $1,204.16 an ounce. Brent crude for August delivery broke through its 50-day moving average, rising $1.36 to $103.02 a barrel. The dollar last traded up 0.7 percent at 98.39 yen, edging toward Monday's peak of 98.70 yen. But traders said its rise could be capped by large sell orders above 98.70 yen. The euro was near flat at $1.3015, with the low at $1.2999.