* OPEC deal sends oil prices soaring
* U.S. bond yields rise again
* $2 trillion global bond rout since U.S. election
By Jamie McGeever
LONDON, Dec 1 Oil swept to a six-week high on
Thursday, lifting energy shares in its slipstream, after OPEC
agreed to cut crude output to clear a glut, while bond yields
rose on prospects that resulting inflationary pressures will
lead to higher interest rates.
European stocks slipped into the red, however, shrugging off
the bounce in Asian shares and following Wall Street's slight
decline the previous day instead.
The Organization of the Petroleum Exporting Countries on
Wednesday agreed to its first output cut since 2008, finally
taking action after global oil prices fell by more than half in
the last two years.
Non-OPEC Russia will also join output reductions for the
first time in 15 years.
U.S. crude oil added to overnight gains of 9 percent
to reach $50.00 a barrel for the first time since October. Brent
crude, which soared $4 overnight, touched a six-week
peak of $52.73 a barrel.
The jump in oil prices added to inflation expectations in
the United States, which were already rising on prospects that
president-elect Donald Trump would adopt reflationary policies
using a large fiscal stimulus.
As a result the rout in U.S. Treasuries resumed, with yields
pushing higher, especially on longer-dated bonds. The yield on
10-year and 30-year bonds <US10YT=RR<, which are
most sensitive to inflation eroding their value, rose 3 basis
points to 2.40 percent and 3.06 percent, respectively.
"Higher oil prices, talk of ultra-long issuance in the U.S.
and strong U.S. data all helped push U.S. yields higher," RBC
Capital markets said in a note to clients on Thursday.
"This remains our key theme for next year as well - we
believe U.S. yields will keep leading the charge higher on
improving macro backdrop and rising inflation expectations."
The 30-year yield has climbed more than 40 basis points
since the Nov. 8 presidential election, heading back towards a
14-month peak of 3.09 percent marked last week.
The 10-year yield had its biggest monthly rise in November
since 2009. Bonds across the world lost about $2 trillion in
market value since the Nov. 8 U.S. election, according to Bank
of America Merrill Lynch data.
Energy and resources stocks in Europe shares outperformed
the broader indices, which snapped a two-day winning run. The
STOXX Europe 600 Oil and Gas index was up 1.5 percent,
while the basic resources index was up 2.1 percent.
Europe's index of leading 300 shares was down 0.3
percent at 1,347 points, Germany's DAX was down 0.3 percent
and Britain's FTSE 100 was down 0.2 percent.
MSCI's index of Asian shares ex-Japan rose
0.5 percent, lifted by stronger-than-expected Chinese
manufacturing data, and Japan's Nikkei 225 rose 1.1
percent after the yen fell to its lowest since February close to
115 per dollar.
On Wall Street, futures are pointing to a flat open on
Thursday following Wednesday's 0.3 percent fall on the
S&P 500 on Wednesday.
All eyes are now on whether the OPEC deal will hold
together. If the bounce in oil prices gathers pace after the
OPEC deal it was expected to have a broad implication on the
Brent is off the 12-year low of $27 per barrel marked in
January but still less than half of where they were in 2014.
Economists expect a further recovery in crude to bode well
for oil-exporting economies, while potentially easing
deflationary pressures in developed economies locked in a battle
against falling prices.
OPEC's output cut is also seen as a boon for U.S. shale
producers, rivals to the oil cartel. The S&P energy index
jumped nearly 5 percent on Wednesday.
"The question is whether this (production cut) is going to
put a floor under the oil price from here. The answer to that
could well depend on what happens with the global economy in the
coming year," said Simon Smith, chief economist at FXPro.
In currencies, the dollar advanced to a 9-1/2-month high of
114.83 yen before pulling back to 114.10 and the euro recovered
from the previous day's slide to trade back above $1.06
after shedding 0.6 percent the previous day.
The dollar index was a shade lower at 101.35.
Spot gold touched a 10-month low of $1,163.45.
Bullion fell 8 percent in November, its worst month in three
(Reporting by Jamie McGeever; Editing by Toby Chopra)