By Chuck Mikolajczak

NEW YORK, Feb 10 (Reuters) - The dollar rose for a third-straight session on Monday after U.S. President Donald Trump warned of more tariffs, including steel and aluminum, while a gauge of global stocks advanced, shrugging off concerns about another round of duties.

Trump is expected to announce on Monday or Tuesday 25% tariffs on all U.S. steel and aluminum imports, and reveal other reciprocal tariffs soon afterward.

China's retaliatory tariffs on some U.S. exports take effect on Monday, with no sign of progress toward a new trade arrangement between Beijing and Washington.

The dollar index =USD, which measures the greenback against a basket of currencies, advanced 0.2% to 108.30, with the euro EUR= off 0.18% at $1.0308.

"This is still very early days," said Marc Chandler, chief market strategist at Bannockburn Global Forex in New York. “The market's just sort of chopping around rather than really directional right now.”

Against the Japanese yen JPY=, the dollar strengthened 0.34% to 151.91 while sterling GBP= dipped 0.37% to $1.2363.

Japanese Prime Minister Shigeru Ishiba expressed optimism on Sunday that his country could avoid higher U.S. tariffs and a tit-for-tat tariff war.

The Canadian dollar CAD= was down 0.1% versus the greenback to C$1.43 per dollar and the Mexican peso MXN= weakened 0.2% versus the dollar at 20.607 as the greenback pulled back from earlier highs.

On Wall Street, U.S. stocks closed higher, led by gains in the energy .SPNY and tech .SPLRCT sectors. The S&P 500 materials index .SPLRCM rose 0.5%, buoyed by steel companies such as Nucor NUE.N, up 5.6%, and Steel Dynamics .STLD.O, which advanced 4.9%.

Shares of McDonald's MCD.N climbed 4.8% after the fast-food restaurant reported quarterly results.

"Investors are basically saying, 'Hey, let's go back into the areas that worked.' And one reason that investors are optimistic, in my opinion, is because of earnings," said Sam Stovall, chief investment strategist at CFRA Research.

MSCI's gauge of stocks across the globe .MIWD00000PUS rose 4.16 points, or 0.48%, to 873.60, on track for its fourth gain in the past five sessions.

Europe's continent-wide STOXX 600 index .STOXX rose 0.58% to close at a record high of 545.92, led by a 1.5% climb in the oil and gas sector .SXEP.

Shares of some European steelmakers retraced early declines, including Luxembourg-based ArcelorMittal MT.AS, which closed down 0.6% and Germany's Salzgitter SZGG.DE, which closed unchanged.

Some analysts are concerned tariffs could rekindle U.S. inflation pressures, removing flexibility from the Federal Reserve to cut interest rates, a possible outcome which has helped support the U.S. dollar since Trump's reelection.

Markets are largely expecting the Fed to hold rates steady at its March meeting, with expectations for a cut of at least 25 basis points not climbing above 50% until June, according to CME's FedWatch Tool.

Fed Chair Jerome Powell is due to speak on Tuesday for the semiannual monetary policy testimony before the Senate Banking, Housing and Urban Affairs Committee. His comments on tariffs and inflation are likely to be closely monitored.

The yield on benchmark U.S. 10-year notes US10YT=RR rose 1.4 basis points to 4.501% as investors awaited a wave of new supply and key economic data such as the latest reading on consumer prices.

Oil prices rebounded despite lingering fears over a potential global trade war. U.S. crude CLc1 settled up 1.86% to $72.32 a barrel and Brent LCOc1 rose to settle at $75.87 per barrel, up 1.62%.

(Reporting by Chuck Mikolajczak, additional reporting by Karen Brettell in New York and Noel Randewich in San Francisco; Editing by Toby Chopra, Rod Nickel and David Gregorio)

((charles.mikolajczak@tr.com; @ChuckMik;))