U.S. 10-year yield at two-year high, stocks rally

NEW YORK/PARIS (Reuters) - U.S. benchmark government bond yields rose above 3 percent, hitting a two-and-a-half year high on Friday, while major global equity markets extended gains to a seventh day in a broad year-end surge. The U.S. 10-year Treasury note yield rose to a high of 3.02 percent, reflecting signs of improvement in the U.S. economy and expectations that the Federal Reserve will steadily withdraw stimulus that kept a lid on interest rates for several years. The MSCI World Index rose as much as 0.5 percent and has gained nearly 20 percent for the year. "The stock market has clearly discounted what the Fed has said.

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