(Adds close of U.S. markets)
* China central bank says it will strengthen economic policy
* Oil gains as supply falls, U.S. rigs hit all-time low
* World FX rates in 2020 http://tmsnrt.rs/2egbfVh
By Herbert Lash and Marc Jones
NEW YORK/LONDON, May 26 (Reuters) - Global equities and oil rose on Tuesday as China's promise of more stimulus and prospects of a world economic recovery cheered investors, who set aside concerns about tense rhetoric between Washington and Beijing.
The euro got a boost from a weaker dollar as rising optimism about the easing of coronavirus pandemic lockdowns supported riskier currencies and sent safe-haven gold lower.
Crude prices rose on growing confidence that producers are following through on commitments to cut supplies and as fuel demand has picked up.
U.S. stocks pared gains after President Donald Trump's economic adviser, Larry Kudlow, said China was making "a big mistake" with planned national security legislation on Hong Kong and pledged Washington would pay expenses of U.S. firms that wanted to shift operations from the city or China. House spokeswoman Kayleigh McEnany said Trump finds it hard to see "how Hong Kong can remain a financial hub if China takes over."
MSCI's gauge of stock performance in 49 countries rose more than 2% at one point, as did its emerging markets index. The S&P 500 climbed past the 3,000 mark for the first time since March 5, up 37% from March lows but still off about 11% from its all-time high in February, and it closed under 3,000.
Europe was powered by a 6.9% surge in travel and leisure stocks .SXTP . On Wall Street, shares of American Airlines AAL.O and United Airlines Holdings UAL.O rose more than 15% and U.S.-listed cruise ship operators jumped about the same.
The major boost for investor sentiment is the reopening of the U.S. and global economies, said Jason Benowitz, senior portfolio manager at the Roosevelt Investment Group Inc in New York.
"Reports of economic activity, while still terrible compared to three months ago, have begun to get less bad as compared to the prior month," Benowitz said.
Spain said quarantine-free tourism would resume next month and Germany edged toward a 9 billion-euro bailout of airline Lufthansa. Melia Hotels International SA MEL.MC rose 13.6% and France's Accor SA ACCP.PA 11.3%, the biggest percentage gainers on the Spanish and French bourses. Norwegian Cruise Line Holdings Ltd NCLH.K and Royal Caribbean Cruises Ltd RCL.N were among the top four percentage gainers on the S&P 500.
But the travel industry remained vulnerable. Latin America's largest airline, LATAM Airlines Group LTM.SN , and its affiliates in Chile, Peru, Colombia and Ecuador filed for bankruptcy protection in the United States.
MSCI's all-country world index <.MIWD00000PUS gained 1.6%, and the pan-European STOXX 600 index .STOXX 1.1%.
The Dow Jones Industrial Average .DJI rose 529.95 points, or 2.17%, to 24,995.11. The S&P 500 .SPX gained 36.32 points, or 1.23%, to 2,991.77 and the Nasdaq Composite .IXIC added 15.63 points, or 0.17%, to 9,340.22.
Crude prices were buoyed by Russia's saying its oil output had dropped close to its target of 8.5 million barrels per day for May and June under the supply deal reached by major producers. futures LCOc1 rose 64 cents to settle at $36.17 a barrel, while U.S. crude CLc1 settled up $1.10 at $34.35.
China's central bank said it would keep pushing to lower interest rates on loans, helping offset tensions between Beijing and Washington over trade, the coronavirus and Hong Kong. broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS advanced 1.7% overnight, with South Korea .KS11 up 1.75% and Chinese blue chips .CSI300 1.1% higher.
Benchmark U.S. 10-year Treasury notes US10YT=RR rose 3.4 basis points to yield 0.6932%.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Asia stock markets
https://tmsnrt.rs/2zpUAr4 Asia-Pacific valuations
Add Chart to Comment
We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
- Enrich the conversation
- Stay focused and on track. Only post material that’s relevant to the topic being discussed.
- Be respectful. Even negative opinions can be framed positively and diplomatically.
- Use standard writing style. Include punctuation and upper and lower cases.
- NOTE: Spam and/or promotional messages and links within a comment will be removed
- Avoid profanity, slander or personal attacks directed at an author or another user.
- Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
- Only English comments will be allowed.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.