Trader's Highlight

DJI-NEW YORK, March 7 (Reuters) - Technology stocks sold off on Monday, with the Nasdaq teetering on a key technical support level as uncertainty over higher oil prices looks set to drive volatility in the days ahead.

The Nasdaq composite index <.IXIC> dropped 1.4 percent and closed just above its 50-day moving average, a widely followed technical level that if breached could signal more declines in the sector that has helped lead the market rally.

Wells Fargo downgraded the semiconductor sector, noting its strong upward moves. The PHLX semiconductor index <.SOX> has risen 130 percent since March 2009. The index also is up 45 percent since the start of September, while the broad S&P 500 has advanced about 25 percent in that period.

NYMEX-NEW YORK, March 7 (Reuters) - U.S. crude oil futures prices rose 2 percent Monday as the conflict in Libya and concerns about the unrest in the region threatening oil flows from other producers sent NYMEX crude above $106 a barrel.

Intensified fighting in Libya and worry that the unrest in North Africa and the Middle East could affect larger producers, including OPEC's top exporter Saudi Arabia have sent both U.S. and Brent crude prices to their highest since 2008.

On the New York Mercantile Exchange, April crude rose $2.28, or 2.2 percent, to $104.42 a barrel at 8:47 a.m. EST (1347 GMT), trading from $104.25 to $106.95.

FCPO-KUALA LUMPUR, March 7 (Reuters) - Malaysian crude palm oil hit two-week highs before paring some gains on Monday, as traders hoped stronger energy prices would strengthen the appeal of biodiesel as unrest in Libya threatens to cut crude oil supplies.

Palm oil prices were also supported by the Malaysian Palm Oil Board (MPOB) chairman's view that stocks in the world's No.2 producer would remain low until April.

Traders expect palm oil prices, which have dropped more than 2 percent so far this year, to rebound during the three-day Bursa Malaysia Palm Oil Conference this week at which analysts are likely to present an upbeat outlook for the industry.

Benchmark May contract on the Bursa Malaysia Derivatives Exchange rose to its highest level since Feb. 22 of 3,700 ringgit ($1,221.324) per tonne before easing to close at 3,695 ringgit ($1,219.673). Traded volume stood at 16,177 lots at 25 tonnes each, above the usual 15,000 lots.

REGIONAL EQUITIES-BANGKOK, March 7 (Reuters) - Most Southeast Asian stock markets posted small gains on Monday as a surge in global oil prices spurred buying in energy and resource shares but investors were worried about rising costs in several other sectors.

The region saw a choppy session and lower volume because of the unrest in Libya. Turnover in Malaysia <.KLSE> fell to 0.6 times the 30-day average, with Singapore <.FTSTI> and Vietnam <.VNI> reporting similarly weak figures.

Singapore's Straits Times Index <.FTSTI> came off its day's high to end up 0.2 percent, but Malaysia's index <.KLSE> ended down 0.45 percent, hovering in negative territory throughout the session.

Among outperformers, Singapore's Sembcorp Marine , the world's second-largest oil rig builder, climbed 2.4 percent and Indonesia's largest gas distributor, PT Perusahaaan Gas Negara , jumped 3.5 percent.

Banks were weak, with Malaysia's biggest, Maybank , down 0.3 percent, Singapore's DBS Group Holdings off 1 percent and top Thai lender Bangkok Bank 1.5 percent lower.