* U.S., European stocks linger near recent highs
* Euro rallies vs U.S. dollar, Aussie dollar
* Copper, tin slip as China's move roils commodities
* McDonald's results help boost U.S. stocks
(Updates to European market close, recasts throughout)
By Alina Selyukh
NEW YORK, Feb 8 (Reuters) - World stocks managed to claw
their way slightly higher while oil and other commodities
prices fell in volatile trade on Tuesday after China raised
interest rates for the second time in six weeks, spurring
worries that global growth will be crimped.
In an intensifying bid to tame high inflation, China said
it would raise its benchmark one-year deposit rate by 25 basis
points to 3 percent.
China is the world's biggest consumer of copper, an
industrial metal often viewed as a barometer for economic
conditions, and the world's second biggest consumer of energy.
The commodity-sensitive Australian dollar fell on concerns
that Australia's economic growth and demand for commodities
could suffer.
The euro rallied broadly on demand from Asian central
banks, while the U.S. dollar and Swiss franc fell across the
board as investors ventured away from safe-haven currencies
after tensions in Egypt eased.
Global stocks coasted, with major averages lingering near
2-1/2-year highs. In the United States, equities rose as gains
in consumer discretionary stocks offset losses in energy
shares.
"China is weighing on commodity prices and commodity
stocks, but it's not weighing so much on the entire market,"
said Randall Warren, president at Warren Financial Service in
Philadelphia. "We need a breather at this point for a healthier
market.
Gold continued to move higher and pushed through resistance
levels by traders covering short positions in the New York
futures market. [] Spot gold <XAU=> rose $17.95,
or 1.33 percent, to $1366.70.
Copper and tin slipped from Monday's record highs. U.S.
crude oil <CLc1> fell 67 cents, or 0.77 percent, to $86.82 per
barrel. In addition to the China rate hike, expectations that
weekly oil inventory reports from industry and government will
show crude stockpiles rose last week weighed on prices.
The U.S. dollar fell 0.46 percent against a basket of major
trading-partner currencies <.DXY>. Against the Japanese yen,
the dollar <JPY=> dipped 0.49 percent at 81.91 yen after
falling as low as 81.83 yen.
The euro <EUR=> gained 0.7 percent to $1.3681, after
climbing as high as $1.3685 earlier in the day.
SUBDUED MARKETS
After weeks of growth in world stock markets, investors
remained focused on corporate earnings and growing merger
activity, tempering the sting from the Chinese rate hike.
The MSCI world equity index <.MIWD00000PUS> added 0.4
percent, hovering at the highest level since August 2008. The
Thomson Reuters global stock index <.TRXFLDGLPU> gained 0.3
percent.
U.S. stocks rose after better-than-expected results from
from McDonald's Corp <MCD.N>, a Dow component, helped boost the
consumer discretionary sector. []
In midday trade, the Dow <> rose 31.79 points, or 0.26
percent, to 12,193.42. The Standard & Poor's 500 Index <.SPX>
gained 2.84 points, or 0.22 percent, to 1,321.89, and the
Nasdaq Composite Index <> added 2.85 points, or 0.1
percent, to 2,786.84.
Europe's FTSEurofirst 300 index <> closed 0.2 percent
lower, retreating slightly from 29-month highs hit on Monday,
Mining stocks fell, with Kazakhmys <KAZ.L>, Lonmin <LMI.L> and
Vedanta <VED.L>all down 1 percent.
Asian markets will reopen on Wednesday after a week-long
close for Lunar New Year holidays.
Emerging stocks <.MSCIEF> were little changed, down 0.1
percent.
Brazil spooked emerging markets on Tuesday, with more
inflationary concerns, reporting the biggest surge of consumer
prices in nearly six years in January. []
"The markets have been relying to some extent on emerging
markets growing for an elongated period and if that's being
called into question, that's a headwind to equity markets,"
said Richard Batty, investment director at Standard Life
Investments.
Worries of growing global inflation also pressured U.S.
Treasury debt prices as traders braced for $32 billion in sales
of three-year notes.
With yields at their highest levels since last spring, the
benchmark 10-year note <US10YT=RR> fell 4/32 to yield 3.65
percent. The 2-year Treasury note <US2YT=RR> shed 3/32,
yielding 0.8 percent.
(Additional reporting by Angela Moon, Richard Leong and
Gertrude Chavez-Dreyfuss in New York and Joanne Frearson, Brian
Gorman and Melanie Burton in London; editing by Andrea Ricci
and Leslie Adler)
