GLOBAL MARKETS-Jump in coronavirus cases halts stock rally; dollar gains

By Herbert Lash and Marc Jones

(Adds close of U.S. markets)

* Hubei province reports 14,840 new cases

* 10-year Treasury yields drop below 1.6%; European yields dip

* Euro struggles after slumping to near 3-year low

* World FX rates in 2020 http://tmsnrt.rs/2egbfVh

By Herbert Lash and Marc Jones

NEW YORK/LONDON, Feb 13 (Reuters) - The dollar rose and global equity markets slumped on Thursday after a new methodology that boosted the coronavirus death toll in China unnerved investors, curbing a rally that had lifted U.S. and European stocks to a series of record peaks.

Chinese officials said 242 people died in Hubei province on Wednesday, the biggest daily rise since the virus emerged in the provincial capital of Wuhan in December.

More than 14,000 new cases were reported in the province on Thursday, up from 2,015 new cases nationwide a day earlier, due to a change to include results from quicker computerised tomography (CT) scans that reveal lung infections, rather than relying just on laboratory tests to confirm cases.

The jump in reported cases halted a rally that lifted Wall Street's three main gauges, indexes for pan-regional European shares, Germany's DAX and Canada's S&P/TSX index.

Investors sought safety in U.S. assets, pushing the yield on the 10-year U.S. Treasury note lower as the euro plunged to a more than two-year low against the dollar. The euro fell to a four-and-a-half-year low against the Swiss franc.

The United States is expected to weather the economic impact of the virus better than the euro zone.

The chief economist of AXA Investment Managers, Gilles Moec, said the impact of the virus could be part of a "perfect storm" for Europe that hurts the economy for months before being compounded by a heated trade battle with the United States.

"We started with the premise that this virus would be worse than SARS and that has now become consensus," Moec said. "So attention turns to who is hit the hardest, and Europe is among the usual suspects and Germany in particular, given China is its biggest export market. So the reaction of the exchange rate is probably rational."

The dollar index rose 0.05%, with the euro down 0.3% at $1.0838.

Europe's main markets followed Asia into red, while stocks on Wall Street traded slightly lower to little changed.

MSCI's gauge of stocks across the globe shed 0.25% and its emerging markets index lost 0.42%.

The pan-European STOXX 600 index lost 0.02%.

The FTSE 100 in London slid 1.1%, derailed by steep falls in heavyweights Barclays and utility Centrica , along with the jolt to risk sentiment from the rise in coronavirus cases in China.

On Wall Street, the Dow Jones Industrial Average fell 128.11 points, or 0.43%, to 29,423.31. The S&P 500 lost 5.51 points, or 0.16%, to 3,373.94 and the Nasdaq Composite dropped 13.99 points, or 0.14%, to 9,711.97.

While the jump in reported coronavirus cases was unsettling, markets in Asia took the news in stride.

MSCI's broadest index of Asia-Pacific shares outside Japan snapped two days of 1% gains to close 0.1% lower as most markets across the region posted modest declines.

Oil prices rose, shrugging off bearish reports that cut demand forecasts for this year on the back of the coronavirus outbreak. China is the world's biggest oil importer.

Paring losses from earlier in the session, Brent crude rose 55 cents to settle at $56.34 a barrel, while U.S. West Texas Intermediate added 25 cents to settle at $51.42 a barrel.

Benchmark 10-year notes last rose 4/32 in price to push its yield down to 1.6139%. The yield earlier touched 1.568%.

U.S. gold futures settled up 0.5% at $1,578.80 an ounce.

There was drama for Brexit-bound British markets.

The sudden resignation of the British finance minister Sajid Javid caused a jump in both sterling and British government bond yields amid bets that his replacement, the 39-year-old Rishi Sunak, will beef up spending.

Javid's departure, coming less than a month before he was due to deliver his first budget and after just 204 days on the job, made him the shortest-serving chancellor of the exchequer since 1970.

"I suspect he (Sunak) is likely to do whatever Boris Johnson tells him to do," said Nomura economist George Buckley. "I don't know what that means for the public finances and fiscal policy, but I doubt it will mean tighter fiscal policy."

(Reporting by Herbert Lash; Editing by Leslie Adler and Marguerita Choy)