GLOBAL MARKETS-Stocks extend pullback from record highs; oil rally pauses

* Yields rise as market eyes new trading range

* Oil at one-year high, copper highest in nearly a decade

* Wall St slips on surprise rise in jobless claims, tech slid (Updates with midday U.S. markets activity; changes byline, dateline, previous MILAN)

By Saqib Iqbal Ahmed

NEW YORK, Feb 18 (Reuters) - A gauge of global equity markets slipped for a third straight session on Thursday as hints of rising inflation led by higher oil prices and the strongest copper prices in nearly a decade kept traders in check after stocks hit a record high earlier this week.

Oil prices erased early gains, with Brent retreating from a 13-month high above $65 a barrel as buying spurred by concerns that a rare cold snap in Texas could disrupt U.S. crude output for days or even weeks petered out.

The MSCI's global stock index was down 0.79% at 677.28. The index touched a record intra-day high of 687.26 on Tuesday, before erasing gains to snap an 11-day winning streak.

Investors' appetite for riskier assets dulled after data showed the number of Americans filing first-time applications for unemployment benefits unexpectedly rose last week, even though the labor market is steadily recovering as additional fiscal stimulus and falling COVID-19 cases allow more service businesses to reopen.

"The one part of the economy that has remained disappointing is clearly the employment picture," said Ryan Detrick, chief market strategist at LPL Financial in Charlotte, North Carolina.

On Wall Street, main indexes fell as investors resumed a shift out of big technology-related firms.

U.S. stock indexes hit record highs at the beginning of the week but gradually retreated following a rise in Treasury bond yields, which led to fears of higher inflation. Those fears have pushed investors to book profit on stocks with high valuation in the S&P 500 technology and communications services sectors.

The Dow Jones Industrial Average fell 249.44 points, or 0.79%, to 31,363.58, the S&P 500 lost 32.89 points, or 0.84%, to 3,898.44 and the Nasdaq Composite dropped 161.28 points, or 1.15%, to 13,804.22.

European stocks fell after a clutch of disappointing earnings reports from companies including Airbus and Orange. The pan-European STOXX 600 index was 0.77% lower.

U.S. Treasury yields rose on Thursday as the market adjusted to higher levels on the longer end of the curve that were reached this week on expectations of extended fiscal and monetary stimulus and signs of an economic upswing.

"Clearly, bond markets are thinking the world economy can normalize and yields can come off emergency levels. They are moving away from only thinking of COVID and QE (Quantitative easing) and are thinking about normalization," said April LaRusse, head of fixed income investment specialists at asset manager Insight Investment.

"But while that will be the general trend, we do think markets may have got a bit ahead of themselves," LaRusse said.

The benchmark 10-year yield, which touched 1.333% on Wednesday, its highest level since Feb. 27, 2020, was last up a basis point at 1.3091%.

The dollar lost ground, ending its first two-day winning streak in two weeks as disappointing labor market data tempered expectations for a speedy economic recovery from the global health crisis. The dollar index was off 0.2%.

Bitcoin eased off its record high of $52,640 reached overnight.

Brent crude was trading at $64.25 a barrel, down 0.14%, while U.S. West Texas Intermediate (WTI) crude futures fell 0.15% to $61.05 a barrel.

Copper surged nearly 3% to its highest since April 2012 as Chinese investors returning from a week-long holiday added impetus to a rally that has almost doubled prices from lows at the height of coronavirus worries last March.

Spot gold XAU= was down -0.03% at $1,775.66 an ounce.

(Reporting by Saqib Iqbal Ahmed; Editing by Dan Grebler)