GLOBAL MARKETS-Stocks, dollar gain on US consumer sentiment data

                                

                                
 * Wall Street flat after retail sales, sentiment data
                                
 * Safe-haven bonds rally on poor U.S. retail sales
                                
 * Dollar up vs yen on consumer data; euro rally fizzles
                                
 * Oil slips below $74 after US retail sales data
 (Adds close of European markets)
                                
 By Herbert Lash
                                
 NEW YORK, June 11 (Reuters) - World stocks and the dollar
rose on Friday after a surprisingly strong reading of U.S.
consumer sentiment suggested the economic recovery remains
intact, easing jitters over an unexpected drop in U.S. retail
sales.
                                
 European shares closed higher for a third day as investors
focused on the survey of U.S. consumer sentiment in early June,
which rose to its strongest level since March 2008.
                                
 European shares also rose after supportive comments from UK
officials helped BP <BP.L><BP.N> rebound, and risk-sensitive
banks gained as investors took heart from the U.S. consumer
sentiment data. For details see: [ID:nLDE65A1RI]
                                
 Deutsche Bank <DBKGn.DE>, HSBC <HSBA.L> and BNP Paribas
<BNPP.PA> all gained.
                                
 U.S. stocks were largely lower, with the Dow industrials
and the broad S&P 500 down slightly as the 1.2 percent drop in
May retail sales reported by the Commerce Department raised
questions about the strength of the U.S. economic recovery.
[ID:nN11132409]
                                
 But the technology-heavy Nasdaq rose on strength in
semiconductor stocks after National Semiconductor Corp <NSM.N>
forecast revenues above estimates, a sign that demand is
bouncing back after a miserable 2009 for the microchip
industry.
                                
 "The real economy is moving forward and a lot of numbers
have come in quite well this week," said Heino Ruland,
strategist at Ruland Research in Frankfurt.
                                
 MSCI's all-country world equity index <.MIWD00000PUS> was
up 0.5 percent, helped by the rally in European markets. The
pan-European FTSEurofirst <.FTEU3> closed up 0.5 percent to
1,018.87 points, driving a 2 percent gain for the week.
                                
 Shares of BP <BP.L> recovered 7.2 percent after hitting a
13-year low on Thursday, as investors welcomed support from
British politicians for the oil major and points to hopes that
its dividend might be deferred rather than cut. The stock is
still down nearly 40 percent since April when the oil spill in
the Gulf of Mexico began.
                                
 At 12:30 p.m., the Dow Jones industrial average <.DJI> was
down 33.41 points, or 0.33 percent, at 10,139.12. The Standard
& Poor's 500 Index <.SPX> was down 3.92 points, or 0.36
percent, at 1,082.92. The Nasdaq Composite Index <.IXIC> was up
3.48 points, or 0.16 percent, at 2,222.19.
                                
 The dollar rose against the yen and euro on the U.S.
consumer sentiment report. Lingering worries about euro zone
debt and technical barriers contributed to the euro's decline,
ending a three-day winning streak that took it as high as
$1.2150. [ID:nN11135189]
                                
 The euro <EUR=> was down 0.35 percent at $1.2066, while the
dollar rose against a basket of major currencies. The U.S.
Dollar Index <.DXY> was up 0.43 percent at 87.545.
                                
 RBS Securities strategist Alan Ruskin said the
better-than-expected rise in Thomson Reuters/University of
Michigan's Surveys of Consumers was "quite a pleasant
surprise," particularly given the recent backdrop of market
volatility and stock market weakness.
                                
 German government bond prices snapped back and U.S.
Treasuries rebounded a day after sharp losses as the weak U.S.
retail sales data revived safe-haven buying of government
bonds. [ID:nN11124156]
                                
 The benchmark 10-year note <10YT=RR> was last up 19/32 in
price to yield 3.26. The 30-year long bond <US30YT=RR> rallied
more than a point in price and was last up 1-4/32 in price to
yield 4.17 percent versus Thursday's close of 4.24 percent.
                                
 Oil prices slid below $74 a barrel after the unexpected dip
in U.S. retail sales, which renewed concerns about the recovery
in the world's largest energy consumer. [ID:nSGE65A07B]
                                
 U.S. light sweet crude oil <CLc1> fell $1.61, or 2.13
percent, to $73.87 a barrel.
                                
 ICE Brent <LC0c1> was trading down $1.62 at $73.67.
                                
 "The retail sales number put a damper on things and the
report on Chinese inflation had already helped pull oil back,"
said Robert Yawger, senior vice president, energy futures at MF
Global in New York.
                                
 Fresh data showed inflation in the world's third-largest
economy quickened to a 19-month high in May while its factory
output and capital spending moderated. [nTOE65A019]
                                
 Spot gold prices <XAU=> rose $6.75, or 0.55 percent, to
$1,224 an ounce.
                                
 Earlier in Asia, the MSCI index of Asia Pacific ex-Japan
stocks <.MIAPJ0000PUS> rose nearly 1.7 percent. Japan's Nikkei
average <.N225> climbed 1.7 percent, helped by a halt in the
yen's advance against the euro <EURJPY=R>.
 (Reporting by Steven C. Johnson and Burton Frierson in New
York; Emma Farge, George Matlock, Jan Harvey and Michael Taylor
in London and Lucia Mutikani in Washington; writing by Herbert
Lash; Editing by Leslie Adler)