(Updated prices at 11:12 a.m ET/ 1512 GMT)

By Sinéad Carew and Amanda Cooper

NEW YORK/ LONDON, Aug 6 (Reuters) - Equities around the

world were attempting a comeback on Tuesday after the previous

day's aggressive selloff while Treasury yields rose and the

dollar was slightly higher as central banker comments countered

recession fears.

Oil prices were volatile, with a weak outlook for demand

partly offset by price support stemming from the risks of an

escalation in the Middle East conflict as well as from a drop in

Libyan production.

But the Nikkei's roughly 10% rebound in Tokyo

brought some relief after the index's 12.4% drop on Monday - its

biggest daily sell-off since the 1987 Black Monday crash.

U.S. Federal Reserve policymakers pushed back on Monday

against the notion that weaker-than-expected July jobs data

means that the economy is in a recessionary freefall.

Late on Monday San Francisco Fed President Mary Daly said

the jobs report leaves "a little more room for confidence that

we're slowing but not falling off a cliff". But she said it was

"extremely important" to keep the jobs market from falling over.

The S&P 500 had lost 3% on Monday, while the Nasdaq

slumped 3.43%, extending a recent sell-off as fears of a

possible U.S. recession spooked global markets.

"We're just getting a little bounce after the sell-off of

the last few days, We're seeing a risk-on bounce," said Michael

O'Rourke, chief market strategist at JonesTrading in Stamford,

Connecticut, noting that investors were adjusting valuations to

prepare in case of a recession..

"You had people panicking yesterday, worried about a

recession. We're having a slowdown but that was the intention of

the rate hikes," said O'Rourke.

"You want to make sure it doesn't turn into a recession,

that we're not slowing too quickly. But thus far the economic

data this year is not recessionary."

On Wall Street at 11:12 a.m. the Dow Jones Industrial

Average rose 399.02 points, or 1.03%, to 39,102.29, the

S&P 500 gained 73.47 points, or 1.42%, to 5,259.80 and

the Nasdaq Composite gained 228.07 points, or 1.41%, to

16,428.15.

MSCI's gauge of stocks across the globe rose

11.04 points, or 1.45%, to 773.12 after falling more than 3% on

Monday, which was its third straight session of declines.

Europe's STOXX 600 index rose 0.46% in a volatile

session with a dip of around 0.5% at its lowest point.

The dollar recovered a little against most major peers and

the Japanese yen steadied around 7-month highs against the U.S.

currency as some of the more striking moves of recent days

reversed somewhat, and a semblance of calm returned to markets.

The dollar index, which measures the greenback

against a basket of currencies including the yen and the euro,

gained 0.06% to 102.93.

Against the Japanese yen, the dollar strengthened

0.37% to 144.7 while the euro was down 0.2% at $1.093.

U.S. Treasury yields rose as fears that the U.S. economy is

quickly entering a recession were seen as overdone, while safe

haven demand for U.S. bonds also ebbed as stocks recovered.

The yield on benchmark U.S. 10-year notes rose

7.5 basis points to 3.858%, from 3.783% late on Monday while the

30-year bond yield rose 6.9 basis points to 4.14%.

The 2-year note yield, which typically moves in

step with interest rate expectations, rose 9.8 basis points to

3.9833%, from 3.885% late on Monday.

Oil prices were volatile with U.S. crude up 0.48% at

$73.29 a barrel while Brent rose to $76.5 per barrel, up

0.26% on the day.

In precious metals, gold prices fell as the dollar firmed,

although expectations of a U.S. rate cut in September and

escalating Middle East tensions limited losses.

Spot gold lost 0.91% to $2,385.70 an ounce. U.S. gold

futures fell 0.72% to $2,384.30 an ounce.