SYDNEY/LONDON (Reuters) -World shares gained on Wednesday as traders bought the dip after recent falls on soft U.S. data and corporate warnings about tariffs, while benchmark U.S. Treasury yields edged up from one month lows.

Europe's broad STOXX 600 index rose 0.2%, after most Asian benchmarks had risen earlier in the day, while S&P 500 futures were 0.3% higher.

U.S. economic data is one major focus for markets, and Wall Street closed lower on Tuesday after data showed services sector activity unexpectedly flatlined in July.

That reinforced the message from Friday's soft jobs data, which caused markets to significantly increase bets on the Federal Reserve cutting rates in September.

"There's this tug of war going on between the more concrete signs that we have seen that the U.S. economy is slowing and the fact that rate cuts are coming which removes some of the pressure on valuations," said Samy Chaar, chief economist at Lombard Odier.

At least for equity investors, the latter view was in the ascendancy on Wednesday.

Meanwhile, on tariffs Chaar said investors were taking comfort from the fact that at least part of the trade war is settling down, though there could be some complacency there.

"The market is more focused on the fact that we're not getting maximalist tariffs, but I wonder if it isn't focusing enough on the fact that we are still getting something moderate, and more could be coming, pharmaceuticals for example."

U.S. President Donald Trump on Tuesday said he would announce tariffs on semiconductors and chips in the next week or so, while the U.S. would initially impose a "small tariff" on pharmaceutical imports before increasing it substantially in a year or two.

He also said the U.S. was close to a trade deal with China and that he would meet his Chinese counterpart Xi Jinping before the end of the year if an agreement was struck. However, he threatened to further raise tariffs on goods from India over its Russian oil purchases.

Tech and semiconductors were also a theme of the day regardless of tariffs. Shares of AI server maker Super Micro fell 17.2% in premarket trading after it missed fourth-quarter estimates, while chip firm Advanced Micro Devices dropped 5.5%.

Chip foundry giant TSMC shares fell 2%.

In the government bond market, Treasury yields edged up after a $58 billion auction of three-year notes went poorly, but still hovered near multi-month lows. More supply will hit the market this week, with $42 billion in 10-year notes on Wednesday and $25 billion in 30-year bonds on Thursday. [US/]

Two-year Treasury yields rose 1 basis point to 3.742%, having risen 3.5 bps overnight, while benchmark 10-year yields ticked up 4 bps to 4.239%.

Fed funds futures imply a 94% chance of a rate cut next month, with at least two cuts priced in for this year, according to the CME's FedWatch.

Investors are waiting for Trump's pick to fill a coming vacancy on the Fed Board of Governors. Trump said the decision will be made soon, while ruling out Treasury Secretary Scott Bessent as a contender to replace current chief Jerome Powell, whose term ends in May 2026.

With European yields moving in line with Treasuries, currency markets were quiet. The euro and sterling were both flat against the dollar at $1.1579, and $1.3288 respectively. [FRX/]

Oil prices rose after four straight sessions of declines. U.S. crude was up 1.44% to $66.1 per barrel, while Brent was at $68.7, up 1.6%. [O/R]

Trump said on Tuesday he will decide on whether to sanction countries that purchase Russian oil after a meeting with Russian officials scheduled for Wednesday.

Spot gold prices slipped 0.4% to $3,365 an ounce.