* European tech stocks follow U.S. peers lower
* Oil rebounds, gold rise above $1,800 an ounce
* Graphic: World FX rates in 2020 tmsnrt.rs/2egbfVh
By Herbert Lash
NEW YORK, July 14 (Reuters) - Global equity markets wavered and gold prices rose on Tuesday after a rollback of California’s reopening hit sentiment, but cyclical stocks surged on Wall Street as some investors bet a recovery would overcome the COVID-19 pandemic’s spread.
U.S. Treasury yields fell after consumer prices showed core inflation remained well under the Federal Reserve’s target while euro zone government bonds slid on renewed U.S.-China tensions and caution over new lockdown restrictions in California.
Europe’s broad FTSEurofirst 300 index dropped 0.79% and weighed on MSCI’s world equity index after a decline overnight in Asian equities. The global benchmark index, which tracks shares in 49 nations, fell 0.14%.
U.S. stocks were mixed, with cyclicals outperforming as technology shares were hammered both on Wall Street and in Europe, where the subsector fell 2.8% in their biggest one-day sell-off in just over a month.
On Wall Street, the Dow Jones Industrial Average rose 1.07% and the S&P 500 gained 0.32%. The Nasdaq Composite dropped 0.27%.
Technology and tech-related shares have sold off and cyclicals are doing well, including financials, industrials and energy stocks, said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York.
“Every once in a while cyclicals will outperform. These are the most beaten up securities in the market. But they’re not the safe trade, which is tech-plus. That’s where the growth is,” Ghriskey said.
“But the cyclicals are extremely attractive from a valuation standpoint and an ultimate recovery standpoint. They have the most to gain back,” he said.
While the rollback of business reopenings may weigh on the economy, new COVID-19 infections are hitting younger people and ultimately will not replicate earlier fatality rates, he said.
The market looks beyond what is happening today in terms of the virus and is anticipating, perhaps incorrectly, that it’s going to die right down, he said.
Oil rebounded. Brent crude was up $0.29 at $43.01 a barrel. U.S. crude was up $0.26 at $40.36 a barrel.
The dollar fell as the euro rose on optimism about the possibility of a European Union stimulus package and as Wall Street trended higher.
The euro rose 0.56% at $1.1404. The U.S. dollar index , which measures the safe-haven greenback against a basket of six rival currencies, slid 0.34% to 96.225.
Gold prices inched up, rising above the $1,800 level, underpinned by concerns over mounting coronavirus cases globally and as many regions reintroduced curbs to restrict the outbreak.
One of the factors that influences gold is fear, said Kristina Hooper, chief global market strategist at Invesco in New York.
“On days when stocks are up and gold is up, part of the story is the Fed has made stocks attractive to investors, but there is apprehension that is driving up gold prices as well,” Hooper said.
U.S. consumer prices increased by the most in nearly eight years in June as businesses reopened, but the underlying trend suggested inflation would remain muted and allow the Federal Reserve to keep injecting money into the ailing economy.
The U.S. Labor Department’s consumer price index rose 0.6% last month, the biggest gain since August 2012, after easing 0.1% in May. The increase ended three straight months of declines and was driven by the rising price of gasoline and food.
Tension grew between Washington and Beijing after the United States rejected China’s claims to offshore resources in most of the South China Sea.
The Shanghai index fell 0.7% despite official figures showing Chinese exports and imports topped forecasts in June, while China continued to buy significant amounts of commodities, including iron ore.
Additional reporting by Pete Schroeder in Washington and Paulina Duran in Syndey; editing by Larry King and Tom Brown