ORLANDO, Florida, March 4 (Reuters) - U.S. and European

stock markets registered solid gains on Wednesday, on hopes that

conflict in the Middle East might soon cool, while stabilization

in oil and energy markets also helped lay the ground for a

rebound in other beaten-down assets.

More on that below. In my column today, I look at why

geopolitical crises and the risk of a dollar liquidity shock are

reminders that the transition away from a dollar-centric

financial universe toward a more fractured, multi-polar world

could be very rocky.

If you have more time to read, here are a few articles I

recommend to help you make sense of what happened in markets

today.

1. U.S. sub sinks Iranian warship off Sri Lanka, killing

87 and expanding war zone

2. Trump's Hormuz shipping plan is too little, too late

in race to avert energy shock: Bousso

3. Gold flubs its lines amid Middle East mayhem: Mike

Dolan

4. ECB wary of Iran-war inflation spike after missing

last "transitory" surge

5. China's factory activity shrinks, but private survey

tops five-year high

Today's Key Market Moves

* STOCKS: Asia hammered - especially South Korea -

Europe up 1-3%, Wall Street closes in the green too.

* SECTORS/SHARES: Eight S&P 500 sectors rise, led by

consumer discretionaries. Energy, consumer staples, materials

fall. Amazon +4%, Cisco +2.5%.

* FX: Rollercoaster for emerging FX - whacked, then

closed strongly. BRL, ZAR, MXN fit that mold, KRW recovers from

17-year low, INR from record low. Biggest G10 gainer is AUD.

Bitcoin +8% above $73,000, a one-month high.

* BONDS: Treasury yields rise again, up 5 bps at the

short end to bear-flatten the curve. 2s/10s curve 54 bps,

flattest close this year.

* COMMODITIES/METALS: Oil steady as U.S. crude stocks

rise, European LNG -10%. Gold +1%, other precious metals up as

much as 3%.

Today's Talking Points

* And ... breathe?

Call it profit-taking, position-squaring, tactical trading,

a technical bounce, or hope that the war may end soon. Either

way, some of the outsized market moves sparked by the Middle

East turmoil stalled or reversed a bit on Wednesday, as

investors took a figurative breather.

That meant oil, the dollar and volatility all fell, while

Wall Street, European stocks, emerging FX and silver rebounded

strongly. Not only did Asia miss out, stocks there got slammed

on Wednesday. Catch-up Thursday, perhaps?

* Underlying economic strength

Health warning - purchasing managers' index surveys for

February pre-date the Middle East crisis. Still, figures on

Wednesday showed that business activity around the world was

humming along at a surprisingly solid clip last month.

Service sector PMIs show that U.S. activity surged to more

than a 3-1/2-year high in February, Chinese activity was the

strongest in three years, and European growth picked up pace

too. This follows fairly upbeat manufacturing PMIs too.

* Warsh nomination goes to the Senate

The ball to make Kevin Warsh the new Chair of the U.S.

Federal Reserve is officially rolling, after President Donald

Trump on Wednesday submitted his nomination of the former Fed

governor to the Senate.

The confirmation process won't be plain-sailing. Some

Senators object to the administration's investigations into

current chair Jerome Powell and Governor Lisa Cook, and others

say Warsh will be merely a puppet for Trump, further eroding the

central bank's independence.

What could move markets tomorrow?

* Developments in the Middle East

* Australia trade (January)

* Taiwan industrial production (January)

* UK PMI (February)

* European Central Bank President Christine Lagarde speaks

* ECB's Luis de Guindos, Olli Rehn, and Sharon Donnery speak

at IIF event in Brussels

* Euro zone retail sales (January)

* Brazil unemployment (February)

* U.S. weekly jobless claims

* U.S. Challenger layoffs (February)

* U.S. productivity (Q4, prelim)

* U.S. import prices (January)

* U.S. Federal Reserve Vice Chair for Supervision Michelle

Bowman speaks

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