GLOBAL MARKETS-Stocks rise on Saudi move, oil still volatile

                                
  
                                
 * Oil rises slightly but down from peaks on Libya fears
                                
 * Swiss franc heads for best two-week rally since June
                                
 * US bonds pare losses after revised U.S. GDP data
 (Adds fresh price quotes, ongoing safe-haven buying)
                                
 By Herbert Lash
                                
 NEW YORK, Feb 25 (Reuters) - Global stocks bounced off a
week-long sell-off on Friday but oil prices edged higher even
after Saudi Arabia boosted oil output to calm fears of supply
disruptions sparked by the uprising in Libya.
                                
 The Swiss franc headed for its biggest two-week advance
against the dollar in eight months and looked set to extend
gains as lingering fears of contagion from unrest in Libya
drove investors to safe-haven assets.
                                
 "The situation remains fluid. Everything still is up in the
air," said Mary Nicola, currency strategist at BNP Paribas in
New York. "As long as it persists, the Swiss franc should
benefit."
                                
 Gold and bond prices also gained, reflecting concerns that
violence could spill over to other oil-producing countries in
the Middle East and crimp global economic growth.
                                
 Oil was off Thursday's peak of almost $120 a barrel for
Brent futures, a level last seen in 2008, but a late bout of
buying to cover short positions lifted prices for the day.
                                
 "I don't think many traders are comfortable being short
over the weekend," said Tom Bentz, a broker at Paribas
Commodity Futures in New York.
                                
 Saudi Arabia raised production about 8 percent to above 9
million barrels per day to make up for a near halt in Libyan
exports, an industry source said, helping prices fall from
peaks last seen in 2008. For details see [ID:nLDE71O1KA]
                                
 The Saudi move bolstered optimism that U.S. consumer
sentiment rose to its highest level in three years in February,
helping offset a report that showed the U.S. economy grew more
slowly than initially estimated in the fourth quarter.
[ID:nN25299682] [ID:nN25247775]
                                
 The U.S. dollar rebounded against the euro but gold prices
rose toward $1,410 an ounce and were on track for a fourth
straight week of gains, supported by safe-haven demand.
                                
 The euro <EUR=> was down 0.44 percent at $1.3742, while
spot gold prices <XAU=> rose $8.87 to $1,408.60 an ounce.
                                
 Consumer sentiment rose to 77.5, up from 74.2 in January,
and the highest since January 2008, according to the Thomson
Reuters/University of Michigan survey.
                                
 Gross domestic product was revised lower to an annualized
rate of 2.8 percent from an initial 3.2 percent estimate.
                                
 The potential spillover of unrest to other oil-producing
counties remained a concern, with trading in oil futures
volatile, considering outages in Libya have risen as high as
three-quarters of its 1.6 million barrels per day output.
                                
 Government forces shot dead two protesters in the Libyan
capital Tripoli, Al Jazeera television reported, as a popular
uprising against Muammar Gaddafi closed in on his main power
base. [ID:nLDE71O00I]
                                
 Still, investors took comfort in Saudi efforts to cover any
supply gaps.
                                
 "Fears that the unrest in Libya could turn into a civil war
and wipe out its oil production have been offset by assurances
from Saudi Arabia that it is raising output," said Gene
McGillian, analyst at Tradition Energy in Stamford,
Connecticut.
                                
 ICE Brent crude futures <LCOc1> in London were up 69 cents
at $112.05 after briefly trading negative on the day. U.S.
light sweet crude oil <CLc1> rose 86 cents to $98.14.
                                
 Stocks in Europe rose, with the FTSEurofirst 300 <.FTEU3>
index of top European shares closing up 1.2 percent.
                                
 World equities as measured by MSCI's  all-country world
index <.MIWD00000PUS> rose about 1.1 percent.
                                
 The Dow Jones industrial average <.DJI> was up 70.20
points, or 0.58 percent, at 12,138.70. The Standard & Poor's
500 Index <.SPX> was up 13.47 points, or 1.03 percent, at
1,319.57. The Nasdaq Composite Index <.IXIC> was up 41.38
points, or 1.51 percent, at 2,779.28.
                                
 U.S. Treasury debt prices rose as turmoil in North Africa
and worries over the economic impact of higher oil prices
maintained a safe-haven bid for government debt.
[ID:nN25406662]
                                
 The benchmark 10-year U.S. Treasury note <US10YT=RR> was up
6/32 in price to yield 3.43 percent.
 (Reporting by Angela Moon, Gene Ramos, Wanfeng Zhou and Chris
Reese in New York; Writing by Herbert Lash; Editing by Kenneth
Barry)