(Adds U.S. market open, byline, dateline; previous LONDON)
* Phase 1 U.S.-China trade deal set to be signed
* MSCI world index, U.S. stocks hover near all-time highs
* Chinese yuan gains, yen weakens on better risk appetite
* Oil falls as U.S.-Iran tensions ease
By Herbert Lash
NEW YORK, Jan 13 (Reuters) - The dollar edged higher while a gauge of global equity markets rose on Monday, lifted by optimism over the planned signing this week of a U.S.-China trade deal and expectations the start of the U.S. corporate earnings season will not disappoint.
Gold prices fell almost 1% ahead of the signing at the White House on Wednesday of the Phase 1 trade deal and as a de-escalation in U.S.-Iran tensions in the Middle East reduced bullion’s safe-haven appeal.
U.S. and euro zone government bond yields rose as the trade deal marks a major step in ending a dispute that crimped global growth and boosted demand for safer assets such as bonds, gold and safe-haven currencies like the Japanese yen and Swiss franc.
MSCI’s gauge of stocks across the globe gained 0.28% while emerging market stocks rose 0.83%.
Middle East tensions rose after the United States killed of a top Iranian general this month and knocked global stocks off a record high. But markets have rebounded with no further escalation in the conflict and the focus shifting to the trade deal.
Wall Street also was higher but European shares slid as investors await the start of earnings season, with large U.S. banks, including Citigroup Inc, JPMorgan Chase & Co. and Wells Fargo & Co. due to report on Tuesday.
“It’s put up or shut up time,” said Joe Saluzzi, said co-manager of trading at Themis Trading in Chatham, New Jersey. “We’ve priced in a big rally, we expect growth and now it’s time to see it. If we have a good earnings season then it will be great.”
U.S. stocks traded just below fresh records set last week.
The Dow Jones Industrial Average rose 55.01 points, or 0.19%, to 28,878.78, the S&P 500 gained 11.82 points, or 0.36%, to 3,277.17 and the Nasdaq Composite added 42.49 points, or 0.46%, to 9,221.35.
Facebook Inc and Apple Inc provided the biggest lift both to the S&P 500 and Nasdaq composite.
The pan-European STOXX 600 index lost 0.29%.
Renault SA fell to a six-year low after a media report said Japan’s Nissan had accelerated secret contingency planning for a potential split from the French carmaker.
Other European automobile stocks were also down, after China’s top auto body reiterated predictions that sales were likely to shrink for the third consecutive year in 2020.
In currency markets, the offshore Chinese yuan hit a 5-1/2-month high and the yen dropped to a 7-1/2-month low as the planned signing of the U.S.-China trade deal boosted sentiment.
The dollar index rose 0.04%, with the euro up 0.12% to $1.1133. The yen weakened 0.44% versus the greenback at 109.94 per dollar.
Oil prices fell as Middle East tensions eased and investors turned their focus to lackluster seasonal demand following a bearish U.S. report last week of a large increase in gasoline stocks.
Brent crude fell 83 cents to $64.15 per barrel, while West Texas Intermediate (WTI) crude slid 66 cents to $58.38 a barrel.
Spot gold dipped 0.69% to $1,551.2781 an ounce. (Reporting by Herbert Lash; Editing by Alison Williams)