* Wall Street gains with help from Fed's Fischer
* Safe-haven bond prices fall; U.S. dollar rises
* Gold slips for second straight session
(Updates prices, changes comment)
By Rodrigo Campos
NEW YORK, Aug 11 A global gauge of equities rose
for a second straight day on Monday, posting its largest daily
advance in four months on bets on a reduced risk of direct
conflict between Russia and Ukraine.
The yield on benchmark U.S. debt rose only slightly while
spot gold prices barely ticked lower.
Perception among stock buyers of a de-escalation of the
conflict in the Russia-Ukraine border held even as Russia was
sending an aid convoy to eastern Ukraine, after the West warned
Moscow against using humanitarian help as a pretext for an
NATO sees a "high probability" of a Russian invasion of
eastern Ukraine as some 20,000 Russian troops massed on the
nearby border. Kiev had the number at 45,000 Russian troops.
"News of humanitarian efforts (in eastern Ukraine) seem to
have soothed the markets," said Mark Luschini, chief investment
strategist at Janney Montgomery Scott in Philadelphia.
"It seems like U.S. investors who are taking a risk on
Russian equities don't deem NATO's statement as a legitimate
concern. They're taking Russia's actions at face value, and not
interpreting it as a cover for military action."
The Market Vectors Russia ETF gained 1.4 percent
while the dollar-denominated RTS index rose 2.8 percent
and the rouble-based MICEX rose 1.8 percent.
Investors also monitored Iraq, where the United States
recently began air strikes targeting Islamic State fighters
marching on the country's Kurdish capital. In Baghdad, the
political showdown continued as Nuri al-Maliki refused to bow to
U.S. and Iranian pressure to step aside after Iraq's president
named a less polarizing prime minister.
An MSCI index of stocks in top developed and emerging
countries shot up 0.8 percent, the most for any
day in four months, though it was still down more than 3 percent
from a record closing high set early in July.
The pan-European FTSEurofirst 300 index jumped 1.3
percent after losing 2 percent last week.
U.S. stocks also got a lift from Federal Reserve Vice
Chairman Stanley Fischer, whose dovish comments could damp down
hawkish bets that the Fed is ready to start a tightening cycle
in monetary policy.
Yields on 10-year U.S. debt rose from 14-month lows hit
Friday following a 72-hour truce between Israelis and
Palestinians as both sides sought to end their month-old war in
Unpredictable developments in the Middle East and Russia
kept the safety bid alive and the yield on the 10-year U.S.
Treasury note edged up just 7 basis points to 2.422
percent. On Friday, it briefly fell to 2.349 percent, a level
not seen since June 2013.
The euro remained under pressure against the U.S. dollar on
expectations of monetary policy easing from the European Central
Bank and the effect of sanctions on Russia.
"We can see continued euro weakness because of the
geopolitical tension on its doorstep," said Alan Robinson,
global portfolio advisor at RBC Wealth Management in Seattle.
Germany is Russia's largest trading partner in the European
Union. EU sanctions announced last month restrict the export to
Russia of equipment to modernize the oil industry and prohibit
the sale of machinery, electronics and other civilian products
that can be used for military or defense purposes.
"However," said Robinson, "geopolitical tension could
dissipate quickly. And if that were to happen, we might see a
relief rally in the euro. I think we have to be a little careful
here, as the euro has come down fairly significantly."
The euro was down 0.2 percent on the day against the dollar
U.S. crude oil and Brent crude futures were
mixed, with U.S. crude ticking up 25 cents to $97.90 per barrel
and Brent crude edging down 47 cents to $104.55.
Spot gold edged 0.1 percent lower to $1,308 an ounce.
(Additional reporting by Akane Otani, Gertrude Chavez-Dreyfuss
and Richard Leong; Editing by Jan Paschal and Chris Reese)