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US stocks rise, European index ends lower

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Euro weakens, Mexican peso falls after Trump tariff

threats

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Oil ends lower on uncertainty around tariffs, Russian

sanctions

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Investors await US inflation data, Q2 earnings season

By Sinéad Carew and Nell Mackenzie

NEW YORK/LONDON, July 14 (Reuters) - MSCI's global

equity index edged up on Monday and longer U.S. Treasury yields

ticked higher as the latest U.S. tariff threats kept investors

on edge while they waited for inflation readings and the start

of earnings season later in the week.

The euro briefly hit an almost three-week low while the

dollar index held steady after U.S. President Donald Trump's

weekend threat to impose a 30% tariff on imports from the

European Union and Mexico from August 1.

Trump said he was open to discussions, while the European

Union accused the U.S. of resisting efforts to strike a trade

deal and warned of countermeasures if no agreement is reached.

Meanwhile, the U.S. earnings season is set to begin on

Tuesday, with second-quarter reports from major banks. S&P 500

profits are expected to rise 5.8% year-over-year, according to

LSEG data. The outlook has dimmed sharply since the early April

forecast of 10.2% growth, before Trump launched his trade war.

"It's all about earnings season now. People are not sure

what it's going to hold. They want to be optimistic. Usually

earnings season pans out better than expected," said Robert

Pavlik, senior portfolio manager at Dakota Wealth in Fairfield,

Connecticut, while noting that valuations are "a bit expensive

relative to the five-year average."

"That, on top of the most recent tariff announcements, has

people sort of just waiting on the sidelines," said Pavlik.

On Wall Street, the Dow Jones Industrial Average rose

88.14 points, or 0.20%, to 44,459.65, the S&P 500 rose

8.81 points, or 0.14%, to 6,268.56 and the Nasdaq Composite

rose 54.80 points, or 0.27%, to 20,640.33.

MSCI's gauge of stocks across the globe rose

0.90 points, or 0.10%, to 923.46.

Earlier, the pan-European STOXX 600 index ended off

0.06%, above its session lows.

PRESSURING POWELL

Trading in long-dated U.S. Treasuries was choppy, with

yields touching multiweek peaks as investors weighed the

prospect of an exit by Federal Reserve Chairman Jerome Powell.

While Powell has indicated a patient stance on interest rate

policy until the impact of tariffs is clearer, Trump has been

pushing for aggressive easing. Trump said on Sunday that it

would be great if Powell stepped down.

White House economic adviser Kevin Hassett warned that Trump

might have grounds to fire Powell because of renovation cost

overruns at the Fed's Washington headquarters.

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

1.2 basis points to 4.435% while the 30-year bond

yield rose 2.1 basis points to 4.9781%.

The 2-year note yield, which typically moves in

step with interest rate expectations for the Federal Reserve,

fell 1.2 basis points to 3.902%, from 3.914% late on Friday.

Besides earnings season, investors are also waiting for U.S.

consumer price data for June, due on Tuesday, and will monitor

for any upward pressure on prices from tariffs.

They will also watch for any tariff impact to supply-chain

costs in producer price and import price figures also due this

week, along with a view of consumer health in retail sales data.

Bitcoin gained 0.71% to $119,970.25 after earlier crossing

the $120,000 level for the first time. The largest

cryptocurrency extended its gains this year to about 30% on

optimism over upcoming U.S. House discussions on digital asset

regulation.

In currencies, traders largely shrugged off new tariffs

ahead of the inflation data.

"It's something that's happened before and the shock value

is gone," Joseph Trevisani, senior analyst at FX Street, said

regarding tariffs. At the same time, "the negative predictions

haven't come to pass so I don't think you're going to get too

much more emphasis for the markets out of tariffs."

The euro was down 0.19% against the dollar at $1.1667

while against the Japanese yen, the dollar strengthened

0.23% to 147.74.

The Mexican peso weakened 0.44% versus the dollar,

with Mexican President Claudia Sheinbaum on Monday hitting back

at U.S. criticism that her government was not doing enough to

combat fentanyl trafficking. She called for the U.S. to do more

to arrest drug traffickers on its own turf and stop the flow of

weapons south across the border.

Sterling weakened 0.55% to $1.3425 after Bank of

England Governor Andrew Bailey said uncertainty is weighing on

growth expectations, in a letter to G20 finance ministers and

central bank governors, urging vigilance against the risk of

disruptive market moves.

Oil prices settled down more than $1 as investors worried

about U.S. trade policy and weighed Trump's threat that buyers

of Russian oil would face sanctions unless Russia agrees to a

peace deal. However, the threat came with a 50-day grace period.

U.S. crude settled down 2.15% or $1.47 at $66.98 a

barrel and Brent finished at $69.21 per barrel, down

1.63%, or $1.15.

Gold prices eased after hitting a three-week peak on Monday

with attention on trade talks and upcoming U.S. economic data,

while silver pared gains after hitting its highest level since

2011.

Spot gold fell 0.34% to $3,344.09 an ounce. U.S. gold

futures fell 0.15% to $3,351.00 an ounce.

(Reporting by Sinéad Carew, Karen Brettell in New York, Nell

Mackenzie in London and Wayne Cole in Sydney; Editing by

Christopher Cushing, Sharon Singleton, Alison Williams, Matthew

Lewis and Lincoln Feast.)