GLOBAL MARKETS-Stocks slide on tech sell-off, bond yields steady

(Adds byline, dateline, Powell remarks, fresh prices)

* Powell comments ease bond-yield angst

* Crude oil, metal prices rise on growth outlook

* Expectations of faster growth spur inflation fears

* Global asset performance:http://tmsnrt.rs/2yaDPgn

NEW YORK/MILAN, Feb 23 (Reuters) - Global equity markets slid on Tuesday as a rally in commodity-related assets gave in to pressure from fears of an over-bought market as investors dumped tech stocks, though remarks by Federal Reserve Chair Jerome Powell helped calm sentiment.

Copper, a leading indicator of the economic cycle, touched a fresh 9-1/2 year high before paring gains as equities markets fell, while oil traded close to more than one-year highs as the easing of coronavirus lockdowns was expected to boost demand.

Gold slid as the dollar rebounded from six-week lows, with other precious metals joining the slide. But a degree of angst was reflected in Cboe's market volatility index, up 6.9% and touching multi-week highs.

Powell said in prepared remarks for a U.S. Senate Banking Committee hearing that the recovery remains "uneven and far from complete," and that it will be "some time" before the Fed considers changing policies aimed at helping regain full employment.

Powell believes monetary policy needs to be supportive and that there is a long way to go to repair the jobs market and before inflation becomes a concern, said Michael Arone, chief investment strategist at State Street Global Advisors in Boston.

"I'm not anticipating any changes to monetary policy any time soon," Arone said, a view that should ease market concerns that the Fed could boost interest rates to tap down inflation.

"U.S. 10-year Treasury rates have climbed very quickly in a short amount of time. And that has spooked investors."

MSCI's benchmark for global equity markets fell 0.68% to 669.22 while the slide on Wall Street was subdued outside of the tech-heavy Nasdaq, which dropped 2.13%.

The Dow Jones Industrial Average fell 0.51% and the S&P 500 lost 0.86%.

In Europe, tech stocks posted their worst day in day four months, falling 3.8%, while the broad FTSEurofirst 300 index closed down 0.46% to 1,583.81.

The decline in tech stocks and rise in value stocks, along with copper and crude oil, show investors are rotating into assets that are expected to do well in an improving economy, said Fawad Razaqzada, market analyst at ThinkMarkets in London.

But the equity decline is a warning sign that risks must be heeded and that investors should not be so reckless or deceived by markets at extremely high levels, he said.

"It's more of a rotation story than of stocks topping out. So the dips will be bought," Razaqzada said. "The market is up almost in a straight line. You've got to have the market correct."

Tesla shares fell into the red for the year, hit by a 12.1% plunge in bitcoin. The electric carmaker recently invested $1.5 billion in the crypto currency, which fell as investors grew nervous of its sky-high valuations.

After being knocked off an eight-month high by European Central Bank chief Christine Lagarde signaling discomfort with the recent surge in yields, the 10-year Bund yield resumed a recent upward trajectory and was last at -0.317%.

The 10-year U.S. Treasury note fell 1 basis points to 1.3534%.

Commodity prices strengthened again.

Oil prices jumped by more than $1 at one point, underpinned by optimism over COVID-19 vaccine rollouts and lower output as U.S. supplies were slow to return after a deep freeze in Texas shut in crude production last week.

Brent crude futures rose $0.03 to $65.27 a barrel. U.S. crude futures slid $0.16 to $61.54 a barrel.

In currency markets, the dollar in early trade briefly dropped to its lowest since Jan. 13, while commodity-linked currencies hovered near multi-year highs.

The dollar index rose 0.151%, with the euro down 0.11% to $1.2141. The Japanese yen weakened 0.13% versus the greenback at 105.19 per dollar.

Spot gold prices fell -0.09% to $1,807.01 an ounce.

(Reporting by Herbert Lash, additional reporting by Danilo Masoni in Milan and Anshuman Daga in Singapore; Editing by Ana Nicolaci da Costa and Jan Harvey)

02/23/2021 17:15

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