(Updates prices, comments)
* Crude prices wobble alongside risk appetite
* Gold up as greenback weakens
* Japan stocks rally; Asia boosts emerging market equities
By Rodrigo Campos
NEW YORK, March 6 (Reuters) - The U.S. dollar dropped to atwo-week low on Tuesday as traders bet on riskier currencies onnews North and South Korea would hold their first summit in morethan a decade and after the South said the North was willing todiscuss denuclearization with the United States.
North and South Korea, still technically at war since 1953but with tensions having eased since the Winter Olympics hostedby the South last month, will hold their first summit in morethan a decade next month, South Korea said on Tuesday. It addedthat the North would suspend nuclear tests while proposed talkswith the United States on denuclearization were underway. impact of the news on stock markets was clouded byconcern over a possible trade war, triggered by tariffs onimports of steel and aluminum proposed last week by U.S.President Donald Trump. Republican lawmakers stepped up calls for Trump to pullback from those tariffs as key trading partner Mexico rejected abid by Washington to drive a wedge between it and Canada intalks to renegotiate the North American Free Trade Agreement.
The U.S. dollar, seen as a safe haven against risk in recentmonths, fell further after news of the North and South Koreatalks as investors bought the Australian and New Zealand dollarsand some emerging market currencies.
"It's too early to wholeheartedly buy these currenciesbecause of the chances of escalating trade tension between U.S.and its trading partners," said Omer Esiner, chief marketanalyst at Commonwealth Foreign Exchange in Washington.
The dollar index .DXY , which tracks the greenback againsta basket of other major currencies, fell 0.51 percent, with theeuro EUR= up 0.54 percent to $1.2402. The dollar index touchedits lowest since Feb. 20.
The Japanese yen JPY= weakened 0.01 percent versus thegreenback to 106.24 per dollar, while sterling GBP= was at$1.3885, up 0.27 percent on the day.
Traders await clues on monetary policy direction afterEuropean Central Bank and Bank of Japan policy-makers meet onThursday and Friday.
"The strength of the euro is starting to put pressure on theeuro zone economy. This is putting pressure on the ECB," saidJack McIntyre, portfolio manager at Brandywine Global inPhiladelphia.
Stocks edged higher in Europe and rose slightly in theUnited States, while a global gauge of major equity markets was boosted largely by gains in Asia after stocks were batteredMonday on concerns over a global trade war. Those worries easedduring U.S. market hours on Monday, so Asian equities werecatching up.
On Wall Street, trade war worries ebbed, lifting the S&P 500for a third straight session, though it was unclear what Trump'sfinal decision on tariffs would be.
"The market is basically grasping for straws around what the(tariff) policy is going to be. Based on the action we saw todayit's hoping it doesn't turn into a trade war," said JonathanMackay, investment strategist at Schroders (LON:SDR) Investment Managementin New York, adding that the news out of the Korean peninsula"helps around the margin."
The Dow Jones Industrial Average .DJI rose 29.2 points, or0.12 percent, to 24,903.96, the S&P 500 .SPX gained 7.86points, or 0.29 percent, to 2,728.8 and the Nasdaq Composite .IXIC added 39.92 points, or 0.54 percent, to 7,370.62.
The pan-European FTSEurofirst 300 index .FTEU3 rose 0.10percent and MSCI's gauge of stocks across the globe .MIWD00000PUS gained 0.69 percent.
Emerging market stocks .MSCIEF rose 1.82 percent. MSCI'sbroadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS closed 1.9 percent higher, while Japan's Nikkei .N225 rose 1.79 percent.
U.S. Treasury yields were little changed in choppy tradingas optimism grew that Trump may back down from his proposedtariffs, even though he said he would not.
His suggestion that Canada and Mexico could be exempted if anew North American Free Trade Agreement (NAFTA) was reacheddrove market participants to see his tariffs talk as leverage inNAFTA talks.
"It does seem as though Trump has laid out the fact thathe's using these tariffs as a negotiating tactic," said GennadiyGoldberg, an interest rate strategist at TD Securities in NewYork.
Benchmark 10-year U.S. Treasury notes US10YT=RR last fell1/32 in price to yield 2.8808 percent, from 2.879 percent lateon Monday.
The 30-year bond US30YT=RR last rose 7/32 in price toyield 3.139 percent, from 3.151 percent late on Monday.
U.S. crude CLcv1 fell 0.02 percent to $62.56 per barreland Brent LCOcv1 was last at $65.75, up 0.32 percent.
Gold rallied on the back of the weaker dollar. Spot gold XAU= added 1.1 percent to $1,334.63 an ounce. U.S. goldfutures GCcv1 gained 1.21 percent to $1,335.90 an ounce.
Copper CMCU3 rose 1.19 percent to $6,992.50 a tonne.
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http://tmsnrt.rs/2jvdmXlGlobal currencies vs. dollar
http://tmsnrt.rs/2egbfVhGlobal bonds dashboard (DO NOT USE UNTIL UPDATE FOUND)
http://tmsnrt.rs/2fPTds0Emerging markets in 2018
http://tmsnrt.rs/2ihRugVMSCI All Country World Index Market Cap
http://tmsnrt.rs/2EmTD6j
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