*

Trump warns of 25% tariffs on steel and aluminum imports

*

Stocks rise despite tariff concerns, led by energy and

tech

*

Fed Chair Powell to speak Tuesday

By Chuck Mikolajczak

NEW YORK, Feb 10 (Reuters) - The dollar rose for a

third-straight session on Monday after U.S. President Donald

Trump warned of more tariffs, including steel and aluminum,

while a gauge of global stocks advanced, shrugging off concerns

about another round of duties.

Trump is expected to announce on Monday or Tuesday 25%

tariffs on all U.S. steel and aluminum imports, and reveal other

reciprocal tariffs soon afterward.

China's retaliatory tariffs on some U.S. exports take effect

on Monday, with no sign of progress toward a new trade

arrangement between Beijing and Washington.

The dollar index, which measures the greenback

against a basket of currencies, advanced 0.2% to 108.30, with

the euro off 0.18% at $1.0308.

"This is still very early days," said Marc Chandler, chief

market strategist at Bannockburn Global Forex in New York. "The

market's just sort of chopping around rather than really

directional right now."

Against the Japanese yen, the dollar strengthened

0.34% to 151.91 while sterling dipped 0.37% to $1.2363.

Japanese Prime Minister Shigeru Ishiba expressed optimism on

Sunday that his country could avoid higher U.S. tariffs and a

tit-for-tat tariff war.

The Canadian dollar was down 0.1% versus the

greenback to C$1.43 per dollar and the Mexican peso

weakened 0.2% versus the dollar at 20.607 as the greenback

pulled back from earlier highs.

On Wall Street, U.S. stocks closed higher, led by gains in

the energy and tech sectors. The S&P 500

materials index rose 0.5%, buoyed by steel companies

such as Nucor ( NUE ), up 5.6%, and Steel Dynamics ( STLD ),

which advanced 4.9%.

Shares of McDonald's climbed 4.8% after the

fast-food restaurant reported quarterly results.

"Investors are basically saying, 'Hey, let's go back into

the areas that worked.' And one reason that investors are

optimistic, in my opinion, is because of earnings," said Sam

Stovall, chief investment strategist at CFRA Research.

MSCI's gauge of stocks across the globe rose

4.16 points, or 0.48%, to 873.60, on track for its fourth gain

in the past five sessions.

Europe's continent-wide STOXX 600 index rose 0.58%

to close at a record high of 545.92, led by a 1.5% climb in the

oil and gas sector.

Shares of some European steelmakers retraced early declines,

including Luxembourg-based ArcelorMittal, which closed

down 0.6% and Germany's Salzgitter, which closed

unchanged.

Some analysts are concerned tariffs could rekindle U.S.

inflation pressures, removing flexibility from the Federal

Reserve to cut interest rates, a possible outcome which has

helped support the U.S. dollar since Trump's reelection.

Markets are largely expecting the Fed to hold rates steady

at its March meeting, with expectations for a cut of at least 25

basis points not climbing above 50% until June, according to

CME's FedWatch Tool.

Fed Chair Jerome Powell is due to speak on Tuesday for the

semiannual monetary policy testimony before the Senate Banking,

Housing and Urban Affairs Committee. His comments on tariffs and

inflation are likely to be closely monitored.

The yield on benchmark U.S. 10-year notes rose

1.4 basis points to 4.501% as investors awaited a wave of new

supply and key economic data such as the latest reading on

consumer prices.

Oil prices rebounded despite lingering fears over a

potential global trade war. U.S. crude settled up 1.86%

to $72.32 a barrel and Brent rose to settle at $75.87

per barrel, up 1.62%.