(Updates prices after U.S. stock market closes)

* Oil climbs on renewed U.S. and Iran hostilities, gaining

9%

* Nasdaq leads Wall Street declines on tech-stock weakness

* Dollar rises versus yen and euro

By Sinéad Carew and Stefano Rebaudo

July 13 (Reuters) - Oil futures surged nearly 9% on Monday

and equities fell as conflict between the United States and Iran

re-ignited over the weekend, once again throttling the flow of

goods through the key Strait of Hormuz.

Over the weekend, Tehran had said it closed the strait, a vital

global artery for oil-and-gas shipping. President Donald Trump

responded Monday by saying the U.S. was reinstating its blockade

of Iranian shipping in the Gulf.

Trump also promised to keep the strait open for a fee, though

the U.S. has not been able to wrest control of the waterway from

Iran since the outset of the war at the end of February.

The revival of the blockade jolted oil markets that had already

been rallying after the two sides had exchanged missile and

drone attacks over the weekend. U.S. crude settled up

9.4%, or $6.73, to $78.14 a barrel while Brent settled

at $83.30 per barrel, up 9.6%, or $7.29.

"The trading of bombs between the United States and Iran is

front and center," said Robert Pavlik, senior portfolio manager

at Dakota Wealth in Fairfield, Connecticut. "It's more of the

same uncertainty surrounding where the Middle East stands.

What's going to resolve it and when is it going to be resolved?"

MSCI's gauge of stocks across the globe

fell 10.26 points, or 0.9%, to 1,116.28.

On Wall Street, the Dow Jones Industrial Average fell

138.37 points, or 0.3%, to 52,498.64, the S&P 500 fell

60.05 points, or 0.8%, to 7,515.34 and the Nasdaq Composite

ended the session down 408.43 points, or 1.6%, at

25,873.18.

Technology shares were the weakest sector on Monday, as

investors sold stocks related to artificial intelligence and

particularly semiconductor shares. U.S.-listed shares of SK

Hynix finished down 9% after rallying sharply on their

Nasdaq debut on Friday.

South Korea's KOSPI KOSPI closed down nearly 9%

overnight. That index has emerged as a key global barometer for

chip-sector sentiment.

Earlier, the pan-European STOXX 600 index finished down

0.01%.

U.S. Treasury yields rose as U.S.-Iran hostilities and rallying

oil prices fanned concerns about inflation pressures and their

potential effect on Federal Reserve monetary policy.

The yield on the benchmark U.S. 10-year note rose

5.06 basis points to 4.62% from 4.569% late on Friday. The

30-year bond yield rose 3.31 basis points to 5.104%.

The two-year note's yield, which typically moves in

step with Federal Reserve interest-rate expectations, rose 6.71

basis points to 4.275%, hitting its highest yield since February

2025.

The U.S. dollar index, which measures the greenback

against a basket of currencies including the yen and the euro,

rose 0.26% to 101.32, with the euro down 0.32% at

$1.1377.

Against the Japanese yen, the dollar strengthened 0.48%

to 162.47.

Sterling weakened 0.47% to $1.3345 at the start of a

pivotal week in British politics as Andy Burnham is expected to

be formally anointed as Labour leader on Friday and be

officially named as UK prime minister on July 20.

Precious metals prices fell on worries about higher-for-longer

U.S. interest rates.

Spot gold fell 3% to $3,998.52 an ounce while spot silver

fell 3.8% to $57.56 an ounce.