* Trump's Iran comments ease oil shock fears

* Iranian media disputes Trump's negotiation claims

* Stocks rebound from four-month low

* Oil tumbles more than 13%

(Updated in New York afternoon time)

By Karen Brettell and Dhara Ranasinghe

NEW YORK, March 23 (Reuters) - Oil plunged and global

stocks rebounded from a four-month low on Monday after U.S.

President Donald Trump said he would postpone military strikes

against Iranian energy infrastructure and said the U.S. was in

talks with Tehran to end the war - a claim Iran quickly denied.

Trump wrote early in the U.S. morning on his Truth Social

platform that the U.S. and Iran had held "very good and

productive" conversations about a "complete and total resolution

of hostilities in the Middle East".

As a result, he said, he was postponing a plan to hit

Iran's energy grid for five days.

Oil prices tumbled by more than 13%, the dollar fell against

other major currencies and government borrowing costs eased.

"You never know who to believe but it does appear that Trump

is trying to start discussions with somebody in Iran to resolve

the war despite strong denials from Iran," said Tim Ghriskey,

senior portfolio strategist at Ingalls & Snyder in New York.

"This has caused significant optimism in stock prices today

with the market up strongly although off its highest levels

because of the Iranian denials."

IRANIAN MEDIA CONTRADICT TRUMP'S COMMENTS

U.S. crude was last down9.61% to $88.84 a barrel and

Brent fell to $99.90 per barrel, down 10.94% on the day.

The Russell 2000 small-cap index gained 2.5%.

The Dow Jones Industrial Average rose 631.00 points,

or 1.38%, to 46,208.47, the S&P 500 rose 74.51 points, or

1.15%, to 6,580.99 and the Nasdaq Composite rose 299.15

points, or 1.38%, to 21,946.76.

MSCI's gauge of stocks across the globe rose

4.93 points, or 0.50%, to 986.24. It earlier reached 970.45, the

lowest since November 21.

The pan-European STOXX 600 index rose 0.61%.

INVESTORS TRIM RATE HIKE EXPECTATIONS

Britain's 2-year bond yield, which has borne the brunt of a bond

selloff since the start of the conflict, fell 17 basis points on

the day to 4.409%. The 10-year yield dropped from its highest

since 2008.

Investors trimmed their bets on Bank of England rate hikes,

now pricing in two hikes by year-end versus more than three

earlier on Monday, while they also cut expectations for the

European Central Bank.

In the U.S., two-year and 10-year Treasury yields were 4 to 5

basis points lower, with the 10-year yield last at 4.348%.

The dollar was broadly soft, having traded higher against most

other currencies until the headline hit. The euro was

last up 0.37% at $1.1613.

"(The market) is not saying that the worst is over, but that

the odds that the worst will manifest itself in the next couple

of days have gone down," said Steven Englander, head of global

G10 FX research and North America macro strategy at Standard

Chartered in New York.

(Additional reporting by Laura Matthews, Sinead Carew, Dhara

Ranasinghe, Yoruk Bahceli, Lucy Raitano and Purvi Agarwal;

Editing by Amanda Cooper, Elisa Martinuzzi, Alex Richardson and

Deepa Babington)