"Recently there has been some optimism that the U.S-China trade war isn't going to be as big of an issue", said Natixis precious metals analyst Bernard Dahdah.
The pan-European FTSEurofirst 300 index rose 0.91 percent and MSCI's gauge of stocks across the globe gained 0.76 percent.
Gold was, however, supported by falling equity markets as a rise in United States bond yields and warnings from bellwether U.S. companies of higher costs drove fears that corporate earnings growth may peak soon.
Spot silver dropped 0.2 per cent to $16.68 an ounce.
The Dow rose 0.25 per cent overnight, ending a five-day losing streak, and the S&P 500 gained 0.18 per cent on optimism over a spate of upbeat earnings that managed to offset jitters over rising US bond yields.
US bond prices fell on Monday, with the 10-year yield hitting its highest in over four years.
Nonetheless, the broader equity market reaction to the latest jump in US yields appeared to be more measured compared to February, when a similar spike in rates sent stocks tumbling.
"The equity markets slid sharply in January and March in response to the rise in Treasury yields".
"For more than six months, dollar-liability flows have outstripped dollar-asset flows, but that is now reversing which is helping the dollar", said Hans Redeker, head of global FX strategy at Morgan Stanley based in London.
The 10-year Treasury note yield rose to 3.035 percent overnight, its highest since January 2014. The yield has climbed on expectations of a steady USA economic expansion, accelerating inflation and concerns about increasing debt supply.
The greenback has risen without pause through much of the past week as concerns over a U.S.
USA gold futures for June delivery settled down Dollars 10.20, or 0.8 percent, at USD 1,322.80 per ounce.
The euro fell to its lowest against the dollar since mid-January, at $1.2096, after the European Central Bank kept monetary policy unchanged.
Against the yen, the dollar set a 2-1/2-month high of 109.46 yen but later eased to 109.32 yen.
Market sources say rising crude oil prices are fueling speculation of higher inflation.
Traders are beginning to question whether the US dollar is really at risk of a long structural decline - as posited by many - when the Federal Reserve will be raising rates faster than other major central banks.