CORRECTED-GLOBAL MARKETS-Stocks, dollar rise on Yellen 'stay course' remarks
(Corrects day of week in first paragraph to Tuesday)
* Stocks rally as Yellen pledges to stay course of Bernanke policies
* Dollar gains, oil prices steady on Yellen's congressional remarks
* Gold rises to three-month high, U.S. government debt sells off
By Herbert Lash
NEW YORK, Feb 11 (Reuters) - The dollar and global equity markets rose on Tuesday after new Federal Reserve Chair Janet Yellen said she expects the U.S. central bank to continue trimming its bond purchases, a sign the U.S. economy is on track for further growth.
The U.S. currency rebounded against the euro and gained against the yen after her written testimony for her appearance before the House Financial Services Committee was released.
Yellen said recent volatility in global financial markets did "not pose a substantial risk to the U.S. economic outlook" and reiterated that the Fed was on track to keep reducing its economic stimulus.
Equity markets, from emerging markets to Europe and Wall Street, advanced as Yellen emphasized continuity in the Fed's policy strategy, saying she strongly supports the approach of her predecessor, Ben Bernanke.
"The last thing she wants to do at this point is complicate things or muddy a well established message. 'Do no harm' is her motto unless data changes more than we have seen so far," said Brad McMillan, chief investment officer at Commonwealth Financial in Waltham, Massachusetts.
MSCI's all-country world index, which measures stock performance in 45 countries, rose 0.67 percent, and its emerging markets index gained 0.93 percent.
In Europe, the FTSEurofirst 300 index of leading regional shares, rose 1 percent.
On Wall Street, the Dow Jones industrial average rose 82.43 points, or 0.52 percent, to 15,884.22. The S&P 500 gained 7.83 points, or 0.44 percent, to 1,807.67 and the Nasdaq Composite added 19.173 points, or 0.46 percent, to 4,167.347.
"'Stay the course' is in my opinion the message the street wanted to hear," said Phil Orlando, chief equity strategist at Federated Investors in New York. "The Fed believes these weather issues, these (emerging market) issues are transitory and we are in a sustainable growth path for U.S. GDP."
U.S. Treasuries slid after Yellen said she strongly supported the Fed's monetary policy strategy, suggesting its current reduction in bond purchases was on track. Yellen's remarks dispelled fears the economy was worse than expected.
The price of benchmark 10-year Treasury notes fell 11/32 to yield 2.7185 percent.
Gold hit a three-month high and oil prices rose, with Brent crude edging above $109 a barrel.
Brent crude was up 38 cents at $109.01 a barrel. U.S. crude traded flat at $100.06.
Gold futures for April delivery rose 1.1 percent to $1,289 an ounce. (Reporting by Herbert Lash; Additional reporting by Francesco Canepa in London; Editing by James Dalgleish)
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