* Brent dips below $100/bbl after Thursday's spike

* Markets see one-in-three chance of Fed rate hike next week

* Yen languishing at 40-year lows as dollar gains

* European shares inch up after Thursday's pounding

(Updates prices before U.S. markets open)

By Shashwat Chauhan and Stella Qiu

July 24 (Reuters) - Global bond yields hovered near

multi-decade highs on Friday as high oil prices stemming from

the Middle East conflict stoked concerns about inflation and

rate hikes, while U.S. and European shares edged above this

week's lows.

News that the U.S. administration will impose higher tariffs

on goods from 60 trading partners also did not help the

inflation picture, with 30-year Treasury yields

marching towards their highest since 2007 and German 10-year

Bund yields - the benchmark for the euro zone -

holding close to their highest since 2011.

The pan-European STOXX 600 rose 0.3% after a more

than 1% drop in the last session, on pace for a mild weekly gain

while stock index futures on Wall Street also pointed to a

slight rebound after Thursday's weakness.

Nasdaq futures inched 0.1% higher, with anear 4%

jump in chipmaker Intel ( INTC ) during premarket trading

following bumper results. Tech stocks have been under pressure

this week as investors grow increasingly uneasy about

multi-billion-dollar spending on AI that has yet to yield

conclusive evidence of paying off.

Brent crude slipped 3% to $97.69 a barrel, after

surging 7% overnight to a two-month high of $102. Attacks by

Iran-aligned Houthis on Saudi tankers in the Red Sea risk

choking off a second crucial Middle East artery for global oil

supplies, alongside Iran's near-closure of the Strait of Hormuz.

President Donald Trump threatened "major military

punishment" for Iran and its Houthi allies, while the U.S.

military conducted a 13th consecutive night of attacks.

"The dollar has been going up for a few days so clearly the

risk has been building and the fact that oil has been at these

higher levels for several days has really started to work

through the cross-asset correlation," said Shaniel Ramjee,

co-head of multi-asset investment at Pictet Asset Management in

London.

Most major currencies were steady against the dollar on

Friday, though the dollar index was on pace for its

biggest weekly jump in about a month, driven in large part by

growing expectations for the Federal Reserve to raise interest

rates.

Markets show traders believe central banks are more likely

to raise borrowing costs, with a one-in-three chance of a rate

hike from the Fed as soon as next week - a sea change from

merely a week ago - while a move in September is more than fully

priced in.

The European Central Bank left rates unchanged on Thursday,

but a September rate hike is about 70% priced in. Data on Friday

offered a more optimistic economic outlook, after surveys of

business activity showed Germany's private sector returned to

growth in July for the first time in four months and contraction

in France's private sector eased this month.

Global tech stocks took a hit earlier this week after

Alphabet and Tesla, the first two of the

so-called "Magnificent Seven" megacap tech companies to report

this season, spooked investors as both burned through cash in

their most recent quarter on their big spending on AI

infrastructure.

"Valuations in U.S. equities are basically off the roof

despite very little cash flow generated by tech and the highest

beta part of the market. In general, this is a market where

there are (some) bubbly signs," said Gabriele Foà, global credit

portfolio manager at Algebris Investments in Milan.

DOLLAR SET FOR STRONG WEEKLY GAINS ON RATE OUTLOOK

In bond markets, the benchmark 10-year U.S. yield

hit a more than 18-month high of 4.7135%, having

climbed 14 basis points this week. The yield on 30-year bonds

was steady at 5.1606%, not far from a 19-year peak of 5.201%.

The yen was pinned near 40-year lows at 163.77 per

dollar, drawing warnings from the U.S. Treasury about excess

volatility in the currency and from Japan's finance minister.

Precious metals edged higher in choppy trading, with gold

up 0.3% at $4,060.7 an ounce after falling 2% the day

before, while silver advanced 1.2% after a decline of

3.4% on Thursday.

(Reporting by Stella Qiu in Sydney and Shashwat Chauhan in

Bengaluru; Editing by Sonali Paul, Lincoln Feast, Amanda Cooper

and Mrigank Dhaniwala and Anil D'Silva)