Updates prices

By Sinéad Carew and Amanda Cooper

NEW YORK, LONDON, June 18 (Reuters) - MSCI's global equities gauge was rising on Thursday while oil prices fell as an interim deal to end the U.S.-Iran war allowed for the reopening of the Strait of Hormuz and fueled some hopes that inflation could ease and that the U.S. Federal Reserve may not need to tighten monetary policy this year.

The United States and Iran signed an agreement on Wednesday that extends a ceasefire announced in April by another 60 days to allow the two sides to negotiate a truce. It also includes the full resumption of maritime traffic "with no charge" in the Strait of Hormuz. But U.S. President Donald Trump threatened to resume attacks and kill Iranian officials if they failed to honour their commitments.

Against that backdrop, oil prices touched their lowest levels since early March, the dollar rose and U.S. Treasury yields dipped. Stock indexes around the world were a mixed bag, however, with shares in Tokyo .N225 and Seoul .KS11 hitting record highs overnight while European stocks fell.

Wall Street indexes gained ground as investors bet that a re-opening of the Strait of Hormuz would ease inflation pressures alongside energy prices and potentially lead to more dovish monetary policy. On Wednesday, U.S. indexes closed lower after the Federal Reserve indicated that it could hike interest rates later this year, after the first meeting with Chair Kevin Warsh at the helm.

"Energy stocks are down, but lower energy prices are going to mean better profits for everybody else who uses energy. It's going to mean less pressure on the consumer," said Brian Jacobsen, chief economic strategist, Annex Wealth Management, Brookfield, WI. "It's going to be less pressure on the Fed to actually follow through on what they threatened, which is rate hikes later this year."

Fed futures still indicated bets that the U.S. central bank would hike rates this year with CME Group's FedWatch tool showing a 38.6% probability that rates would be 25 basis points higher by December and a 32.6% chance that they would rise by 50 basis points.

Jacobsen said that Thursday's trading was reflecting investor caution about what happens after the 60-day negotiating period between the U.S. and Iran.

"It's more a bounce than a change in direction. I'd expect to move sideways from here for a little while. It's mostly because there's enough skepticism out there. Will the memorandum of understanding result in a lasting deal?" he said.

On Wall Street at 11:01 a.m. ET (1501 GMT), the Dow Jones Industrial Average .DJI was 262.02 points, or 0.51%, higher at 51,754.57, the S&P 500 .SPX rose 74.17 points, or 1.00%, to 7,494.43 and the Nasdaq Composite .IXIC rose 343.55 points, or 1.33%, to 26,368.43.

MSCI's gauge of stocks across the globe .MIWD00000PUS rose 6.00 points, or 0.54%, to 1,127.12.

The pan-European STOXX 600 .STOXX index fell 0.31%. Europe is more vulnerable to an increase in inflation from higher oil prices than the United States and so falling oil prices are good for European economies, but the weight of energy shares kept the pan-regional index slightly in the red.

In energy markets, U.S. crude CLc1 fell 3.36% to $74.21 a barrel and Brent LCOc1 fell to $77.13 per barrel, down 3.04% on the day.

In currencies, the dollar rose for a second day after the Fed meeting fanned expectations for higher rates with nearly half of its policymakers indicating they now expect a hike this year, as concerns mount on inflation.

The dollar index =USD, which measures the greenback against a basket of currencies including the yen and the euro, rose 0.21% to 100.56, with the euro EUR= down 0.14% at $1.1483.

Against the Japanese yen JPY=, the dollar strengthened 0.14% to 160.84.

Sterling GBP= weakened 0.32% to $1.3248 after the Bank of England left interest rates unchanged.

In Treasuries, the yield on benchmark U.S. 10-year notes US10YT=RR fell 3.14 basis points to 4.432%, from 4.463% late on Wednesday, while the 30-year bond US30YT=RR yield fell 4.82 basis points to 4.8788%.

The 2-year note US2YT=RR yield, which typically moves in step with interest rate expectations for the Federal Reserve, fell 1.39 basis points to 4.149%.

In precious metals, spot gold XAU= fell 0.14% to $4,251.08 an ounce. Spot silver XAG= fell 2.26% to $66.45 an ounce.