* Wall Street gains modestly with help from Fed's Fischer
* Safe-haven bonds fall
* Dollar rises
* Emerging markets for equities rally
(Adds New York trading, latest prices and quotes; changes
byline and dateline; previous LONDON)
By Michael Connor
NEW YORK, Aug 11 Global stocks bounced after
recent sell-offs and core government debt prices fell on Monday
as markets saw receding risks of direct conflict between Russia
and Ukraine while Middle East tensions diminished.
Wall Street, which erased a week's losses on Friday during a
rally ignited by Russia's ending of military exercises near its
Ukraine border, on Monday extended the global gains many see as
The main U.S. stock indexes were up modestly in early New
York trading, partly on relief over Ukraine.
U.S. equities were also boosted by Federal Reserve Vice
Chairman Stanley Fischer, who said the recoveries in the U.S.
and global economies had been "disappointing," indicating the
Fed may not imminently raise interest rates.
The MSCI World Index, which tracks stocks
from developed economies, was up 0.67 percent at 9:50 a.m. EDT
(1350 GMT), though still down nearly 4 percent from July highs
as the prevailing market mood remained a cautious one.
"Tangible events have outweighed good economic data in
determining the near-term course of bonds and stocks because
events have supplied the more persuasive story trend in 2014,"
said strategist Jim Vogel of FTN Financial in Memphis,
Tennessee. "Investors know they have to reconnect the two
eventually, but 'eventually' might not be found until 2015."
The pan-European FTSEurofirst 300 index tracked
Asia up 1.2 percent.
The Ukraine crisis has hit European markets particularly
hard, with the German blue-chip DAX index down 9
percent from its June peak, luring investors looking for
attractively priced entry points into European equities.
"Fears over the conflict between Ukraine and Russia have
receded for now, which is helping the market recover some
ground," said Arnaud Scarpaci, fund manager at Montaigne Capital
in Paris. "But this is mostly a technical bounce which should
last just a few days."
An increased appetite for risk led to a modest drop in
safe-haven bonds, with German Bund futures slightly
Yields on long-duration U.S. Treasuries, which last week
touched 14-month lows on fear-driven buying, eased in early New
York trading before turning flat. The benchmark 10-year
was off 1/32 to yield 2.418 percent.
The dollar was up 0.7 percent against a basket of six major
The cautious mood extended to the market's assessment of
events in the Middle East, with investors keeping an eye on
political infighting in Iraq and talks in Cairo between Israel
and the Palestinians on ending the month-old Gaza war.
"There has been a slight easing in (global) geopolitical
tensions, but the underlying situation ... remains fragile,"
said Nick Stamenkovic, bond strategist at RIA Capital Markets.
Emerging markets also got a boost, with the MSCI Emerging
Market index up 1.4 percent.
U.S. crude oil and Brent crude futures were
mixed, with the former ticking up 33 cents to $97.98 per barrel
and the latter edging down 12 cents to $104.91.
Gold was off 0.15 percent at $1,309 an ounce.
(Reporting By Michael Connor in New York; Additional Reporting
By Lionel Laurent in London; Editing by Jonathan Oatis)