(Adds gold, oil settlement prices)
* Abe resigns on health grounds; yen jumps
* Investors say lack of detail on Fed policy shift
* U.S. oil prices little moved by massive storm
* Graphic: 2020 asset performance http://tmsnrt.rs/2yaDPgn
* Graphic: World FX rates in 2020 http://tmsnrt.rs/2egbfVh
By Herbert Lash
NEW YORK, Aug 28 (Reuters) - Global equity markets rose to a new high on Friday as U.S. consumer spending in July suggested a strong economic rebound lies ahead, while the Japanese yen surged on safe-haven buying after Prime Minister Shinzo Abe resigned for health reasons.
The dollar approached lows last seen in May 2018, retreating from Thursday when the Federal Reserve set forth a new stance on inflation that will allow it to run a bit hot and reinforced expectations of a prolonged low interest-rate environment.
Longer-term yields fell and gold rose more than 2% as investors sought a store of value in the face of higher inflation and real rates that are negative.
U.S. consumer spending increased more than expected last month, raising expectations for a sharp rebound in growth in the third quarter, though momentum could ebb as the COVID-19 pandemic lingers and fiscal stimulus dries up.
A U.S. Commerce Department report also showed a rise in personal income after two straight monthly declines, while monthly inflation pushed higher.
"There's a big bounce on Main Street, the economic data every day on Main Street is bouncing higher," said Jim Paulsen, chief investment strategist at Leuthold Group in Minneapolis.
People are getting more optimistic about the economy but underneath that is a healthy dose of caution as "Main Street is still a mess," he said.
"As the market keeps going up, more and more of them are reducing their bearish bets a little bit and putting more into stocks, which is helping drive the market higher," he said.
MSCI's benchmark for global equity markets rose 0.43% to 585.73 after earlier setting a new intraday high, while stocks on Wall Street also rallied, with technology leading the way and the Dow close to an all-time high.
The Dow Jones Industrial Average rose 0.54%, the S&P 500 gained 0.45% and the tech-laden Nasdaq Composite added 0.49%.
"A lot of this is momentum. It's just fear of being left behind, fear of missing out," said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York.
"Value has been outperforming growth and you're seeing that reverse today. When growth underperforms for a period of days, it tends to rebound very sharply. We're seeing that in market preferences today."
Information technology rose 0.9% and accounted for about half of the S&P 500's gain.
In Europe, stocks slipped as investors dumped this year's outperformers, including technology and healthcare stocks, and bid up banking shares after the Fed unveiled its new policy framework.
The broad pan-regional FTSEurofirst 300 index slid 0.50% to close at 1,429.82.
In Japan, the benchmark Nikkei 225 share index closed down 1.4% while the yen, seen as a safe-haven currency to buy in times of uncertainty, strengthened 1.03% versus the greenback at 105.46 per dollar.
The yen was on course for its biggest one-day jump since March, when the coronavirus pandemic roiled global markets.
There has been speculation about Abe's health all week but the resignation of Japan's longest-serving premier rattled investors, given he has spearheaded efforts to revive growth through his reflationary "Abenomics" policies.
Some analysts said the yen's rally seemed excessive given Abe's successor was unlikely to alter economic policy significantly because Japan remains in the middle of a battle to avoid deflation and lift growth.
"You're seeing yen strength on a little bit of uncertainty," said Lou Brien, strategist at DRW Trading in Chicago. "Abenomics has been one of the more influential economic strategies."
The dollar index fell 0.657%, while the euro rose 0.53% to $1.1884.
The yield on the 10-year U.S. Treasury note pared losses to trade down 1.3 basis points to 0.7326%. Investors are rebalancing intermediate-dated debt following large auctions earlier this week.
U.S. Treasury auctions of roughly $150 billion worth of three-year, five-year and seven-year notes received strong demand starting on Tuesday. The decline in yields on each of those instruments on Friday likely reflected traders repositioning, said Subadra Rajappa, head of U.S. rates strategy for Societe Generale.
German bond yields briefly rose to their highest since early June after the Fed's decision to target average inflation.
Oil prices slid a notch after Hurricane Laura passed the heart of the U.S. oil industry in Louisiana and Texas without causing widespread damage and companies began to restart operations.
Brent crude futures settled down 4 cents at $45.05 a barrel and U.S. crude futures slipped 7 cents to settle at $42.97 a barrel.
U.S. gold futures settled up 2.2% at 1,974.90 an ounce.
(Reporting by Herbert Lash; additional reporting by April Joyner in New York; Editing by Dan Grebler and Tom Brown)